The formerly non-listed real estate investment trust American Realty Capital Healthcare Trust, Inc. (NASDAQ:HCT) began trading on April 7 on the NASDAQ Global Select Market.
Created in 2011 as a public non-listed REIT focused on healthcare real estate, ARC Healthcare stock closed at $10.55 on Monday after reaching a high of $10.70, with approximately 1.6 million shares traded. The REIT has a $1.92 billion market cap, with senior housing assets comprising a third of its 141-property portfolio.
ARC Healthcare Trust’s successful listing on NASDAQ is a “very important” milestone for the REIT, said CEO Tom D’Arcy in a statement.
“By listing on NASDAQ, we achieve two goals: position the company for more efficient access to the capital markets to drive future growth and provide liquidity for our shareholders,” he said.
In February 2011, ARC Healthcare raised $1.5 billion through the sale of common stock in connection with its initial public offering. The funds were used to acquire an approximately $3 billion portfolio of healthcare-related real estate, and the REIT’s nontraded offering closed in April 2013.
Since then, the REIT has built a 141-property portfolio primarily focused on medical office buildings (44%) and senior housing properties (33%), along with other real estate properties across the healthcare spectrum, including hospitals and post-acute care facilities. Senior housing assets represent 30% of the REIT’s net operating income.
ARC Healthcare’s top senior housing managers are The Arbor Company, Principal Senior Living Group, Frontier Management, MBK Senior Living, and Meridian Senior Living.
“Our focus has always been to enhance shareholder value by building a well-diversified portfolio of assets, with a strong and flexible capital structure, led by an experienced and proven management team,” said Nicholas Schorsch, executive chairman of ARC Healthcare’s board of directors. “By strategically and systematically executing our business plan, which includes today’s listing of our shares on NASDAQ, we believe ARC Healthcare is well-positioned to further drive value throughout the next phase of the company’s evolution.”
Healthcare in the U.S. is a $1 trillion industry, ARC Healthcare noted in its investor presentation, and ownership of healthcare real estate is “deeply fragmented.” The REIT has more than $350 million of remaining capacity under its credit facility and is leveraged at 5.9x.
In conjunction with listing it shares of common stock on the NASDAQ Global Select Market, ARC Healthcare also commenced a tender offer to purchase up to $150 million of common stock from its stockholders. The REIT offered a purchase price of $11.00 per share, less taxes and interest.
As of about noon Eastern Time, American Realty Capital Healthcare Trust was trading at $10.33.
Written by Alyssa Gerace