Ventas, Inc. (NYSE:VTR) has agreed to acquire a 100% interest in 16 private-pay senior living communities from affiliates of Sunrise Senior Living, Inc. (NYSE:SRZ) and its institutional joint venture partner for $362 million.
Sunrise will receive approximately $28 million for its 20% ownership in the portfolio and will remain the manager of the communities under preexisting terms relating to management fees and contract length, which now range from 18 to 27 years.
“With the acquisition of these exceedingly high-quality seniors living communities, we continue our enterprise growth while also expanding our private pay revenue source,” Ventas Chairman and Chief Executive Officer Debra A. Cafaro said in a statement. “We are especially pleased to expand our relationship with Sunrise, the global leader in seniors living.”
The acquisition is expected to be immediately accretive to normalized funds from operations per share; Ventas will fund the purchase through its revolving credit facility.
The 16 properties were developed by Sunrise and have a median age of four years; they contain 1,274 units.
“This is another positive event for Sunrise as it demonstrates the value of our purpose-built assets, provides us with additional capital, and reaffirms our positive and growing relationship with Ventas,” said Sunrise CEO Mark Ordan.
All of the properties will be acquired unencumbered, and the transaction is expected to close in the second quarter of 2012.
Written by Alyssa Gerace