Real estate investment trust Newcastle Investment Corp. (NYSE:NCT) announced it has completed the acquisition of six continuing care retirement communities for $186 million.
Newcastle has entered into a triple-net master lease agreement with LCS, with an initial lease term of 15 years with two five-year renewal options. The deal has an initial cash lease yield of 7.6% with 3.75% increases in years two and four, and 2.5% in years five and 15.
The addition of the Texas-based CCRCs adds a total of 1,265 beds to Newcastle’s growing senior housing portfolio, which the Newcastle plans to expand even more with the recently announced creation of its spin-off company, New Senior Investment Group Inc. (NYSE:SNR), a publicly traded REIT focused specifically on the senior housing sector.
The most recent deal is among the more than $300 million worth of acquisitions Newcastle had in the pipeline last month. During an earnings call in May, Newcastle executives said the company was under contract to acquire 15 senior housing properties with a price tag of $319 million.
Throughout the past two years, Newcastle has invested more than $700 million of equity to acquire 95 senior housing properties with more than 11,900 beds, totaling more than $1.8 billion in assets.
Written by Emily Study