Senior Housing Property Trust (SNH) Looks like a Good Long Term Investment

Senior Housing Property Trust (NYSE: SNH) looks attractive as a long term investment and dividend play. It is a REIT focused on owning and operating health care facilities across the country. Health Care real estate and senior housing looks to be a promising area to be invested over the next several decades as baby boomers age and utilize senior housing and assisted living facilites.

The Health Care REIT sector as a whole performed relatively well over the past several years ( including NYSE: HCN, NYSE: HR, NYSE: SNH). Over the past 2 years (since the general market peak) Health Care REITs as a whole are little changed, while yielding around 6% - 6.5%. This compares to the S&P 500, down around 30% over the same period, and REITs in general (measured by Vanguard REIT ETF (NYSE: VNQ)) down 40%.

Operating results have held up very well through the downturn and analysts see steady profits going forward. SNH currently yields 7%, which looks to be sustainable over the longer term.

Today the company did announce the offering of 6.5M shares priced at $19.44. This has put pressure on the stock and it is trading down 3.2% in mid morning trading.

I see no hurry to buy immediately as the stock has had quite a run recently and I would give some time to let the dilution story run its course. However over the long term it looks like a solid play in the Health Care Real Estate sector.