Sabra Health Care REIT, Inc. (NASDAQ:SBRA) recently announced the acquisition of a nine-property portfolio of senior housing communities located in Michigan for $49 million.
The sale/leaseback transaction includes a triple-net master lease agreement with affiliates of Retirement Living Management, featuring a 10-year initial term with two five-year renewal options. The lease provides for annual rent escalators equal to the greater of the change in the Consumer Price Index or 3.0%, resulting in annual lease revenues determined in accordance with GAAP or $4.5 million and an initial yield on cash rent of 8.0%.
Sabra will also have right of first refusal to acquire an additional facility operated by Retirement Living Management and add that facility to the master lease agreement as well.
“These are beautiful resident-centric physical plants built to suit today’s higher-needs assisted living resident,” said Rick Matros, Sabra CEO and chairman, in a statement. “The assets are relatively new, with all but two built in the last 10 years by the Retirement Living team.”
The portfolio has a total of 322 units. Boulder, Colo.-based Evans Senior Investments represented Retirement Living in the transaction.
Written by Alyssa Gerace