Emeritus to Acquire Remaining Interest in 24 Assisted Living Facilities From Blackstone

Emeritus Corporation (NYSE: ESC) has entered into an agreement with Blackstone Real Estate Advisors to acquire 24 assisted living communities, compromised of approximately 1,867 units.

The communities are part of a joint venture between the two, with Emeritus owning 19% and Blackstone an 81% interest.  Since late 2006, Emeritus has been operating the communities for a fee equal to 5% of collected revenues.

“We have operated these communities under a management agreement that incentivized us to improve operations – that incentive represents a significant portion of the equity required to complete this purchase transaction,” said Dan Baty, Emeritus Chairman. “We are pleased that the joint venture with Blackstone has proven to be so successful, and we look forward to delivering similar results on the much larger Sunwest portfolio of 144 communities.”


Emeritus said the net purchase price to acquire Blackstone’s interest is expected to be roughly $99.0 million.  This purchase price is based on a total portfolio value of $310.0 million, which is expected to be financed with mortgage debt of approximately $220.0 million, approximately $40.0 million in cash on hand.