Care Investment Trust Inc. (OTCQX:CVTR) has entered an agreement to purchase a seven-property senior housing portfolio from affiliates of Juniper Communities, LLC for $106.5 million.
The assisted living and memory care assets are located in desirable markets in New Jersey, Pennsylvania, and Colorado and have a total of 410 units with an average occupancy rate of approximately 94% as of the end of August 2012.
The trust will acquire the real estate and operating assets of the private-pay communities through the RIDEA structure, and an affiliate of Juniper will continue to manage the properties pursuant to a long-term management agreement. Care will own 100% of the real estate and operating assets through a RIDEA-compliant structure, separating the real property assets (which will be held by wholly-owned property companies) and the operating assets (which will be held by wholly-owned operating companies).
Care expects to finance the acquisition of the portfolio through cash on hand and non-recourse, property-specific acquisition financing from Fannie Mae and HUD, as well as the assumption of existing non-recourse property specific financing from HUD. KeyBank Real Estate Capital has been selected to underwrite the agency financings.
While the purchase agreement is subject to customary closing conditions, the transaction is expected to close in the fourth quarter of 2012.
“The time is right for this capital event that will further Juniper’s growth. Entering into this financial partnership with Care assists us in keeping pace with the future of our industry,” said
Lynne S. Katzmann, President and CEO of Juniper. “The impact that aging baby boomers will have on the industry will be more pressure on growth to meet needs, and to deliver services in new and improved ways both environmentally and programmatically. Care is an ideal partner for Juniper as we have similar values regarding the quality of care needed for residents.”
This will be Care’s first RIDEA-structured holding.
Written by Alyssa Gerace