Sunwest Management (Sunwest), an Oregon-based senior living provider, and Blackstone Real Estate Advisors (Blackstone), a real estate private equity firm, have reached agreement on the terms of sale of up to 148 senior living properties controlled and managed by Sunwest. Under the preliminary agreement between Blackstone and Sunwest, Sunwest would proceed with the plan of distribution currently pending before the U.S. District Court in Eugene, Ore., in the lawsuit filed last March by the Securities and Exchange Commission (SEC). The court will consider the receivership plan at the end of this month. If it approves that plan, the court would subsequently consider the Blackstone transaction in conjunction with Sunwest’s reorganization in Chapter 11 towards the end of this year.
In making its offer, Blackstone is partnering with Emeritus Senior Living, one of the nation’s largest senior living providers managing 309 communities in 36 states, and Columbia Pacific Management, Inc., an entity controlled by Dan Baty, Chairman and Co-CEO of Emeritus. Under the terms of the proposal, Emeritus would be appointed as manager of the newly-acquired facilities once the transaction is complete. Emeritus will also have the option to invest up to 10% of the equity in the joint venture entity along with Blackstone and Columbia Pacific.
“This purchase offer by Blackstone, one of the world’s premier private equity firms, validates the hard work of a lot of people,” said chief restructuring officer Clyde Hamstreet. “It recognizes the effort and dedication of our employees and the quality care and services they provide to our residents. And it recognizes the major strides we have taken in the past ten months to preserve and build value for Sunwest’s investors and creditors.”