Capital Senior Living Corporation (“CSU”) (NYSE:CSU) announced that Midwest Portfolio Holdings II, LP (“Midwest II”), a joint venture in which it holds a 15% partnership interest, has entered into an agreement to sell three senior living communities to Health Care REIT, Inc. (NYSE:HCN). Upon closing the transaction, CSU will lease the communities from HCN. CSU currently manages the three communities in the joint venture under long-term management agreements. The three communities, located in the state of Indiana, being leased have approximately 300 units and include 198 units of assisted living and 102 units of memory care, with resident capacity of nearly 350. At the end of 2009, financial occupancy at the combined communities was 90%.
“Similar to our first transaction with HCN, this transaction will also provide immediate benefits to our shareholders,” commented Lawrence A. Cohen, Chief Executive Officer of the Company. “In addition to a significant increase to our top-line revenue, the lease will be immediately accretive to cash flow and earnings. While we have been earning management fees on these communities since 2006, we will now be able to consolidate
the results of operations and benefit fully from further improvement in occupancies and rental rates. These three communities are strategically located in the Midwest portion of the country, where nearly 50 percent of our operations are located. We are extremely pleased to enter into another transaction with Health Care REIT, Inc., a leading healthcare REIT that invests across the full spectrum of senior housing and health care real estate.”
For more information, visit http://www.capitalsenior.com/Documents/Release3.8.10.pdf