TOLEDO, Ohio--(BUSINESS WIRE)--
Health Care REIT, Inc. (HCN) announced today that the company has agreed to enter into a triple net lease with Emeritus Senior Living (ESC) on a portfolio of 38 high-quality seniors housing communities currently owned in an 80%/20% joint venture between Health Care REIT and Merrill Gardens. Health Care REIT will acquire Merrill Gardens 20% equity interest in the joint venture for $173 million, which includes pro rata mortgage debt of $82 million. The transaction is expected to close in the third quarter upon receipt of regulatory and lender consents.
This transaction reflects the flexibility of our business model and the power of our relationship investing platform, said George L. Chapman, Chairman and CEO of Health Care REIT. We are excited to grow our long-time relationship with Emeritus. Their strong existing footprint in the markets where this portfolio is located will allow for a seamless transition and value creation over the long-term. Merrill Gardens has made the decision to concentrate its efforts on new development projects. Merrill Gardens will continue to be a strategic partner for Health Care REIT.
Transaction Highlights
Predictable, Attractive Rent Growth with Upside Potential
This high quality, well-located portfolio broadens and strengthens our service offerings in key markets, allowing us to create significant long-term value, said Granger Cobb, CEO and President of Emeritus. We are very pleased to welcome these Merrill Gardens communities to our family and to expand our relationship with Health Care REIT.
Emeritus has an excellent reputation for quality and a proven track record of success that will benefit our residents, said Bill Pettit, CEO of Merrill Gardens. We are proud to have created such a strong portfolio of communities and will assist Emeritus to ensure a smooth transition. We are focused on our development strategy and continuing our nearly 20-year partnership with Health Care REIT.
About Health Care REIT, Inc. Health Care REIT, Inc., an S&P 500 company with headquarters in Toledo, Ohio, is a real estate investment trust that invests across the full spectrum of seniors housing and health care real estate. The company also provides an extensive array of property management and development services. As of March 31, 2013, the companys broadly diversified portfolio consisted of 1,133 properties in 46 states, the United Kingdom, and Canada.
About Emeritus Senior Living. Emeritus Senior Living, based in Seattle, Washington, is the nations largest assisted living and memory care provider, with the ability to serve nearly 50,000 residents. More than 30,000 employees support nearly 480 communities throughout 45 states. Emeritus offers the spectrum of senior residential choices, care options and life enrichment programs that fulfill individual needs and promote purposeful living throughout the aging process. Its experts provide insights on senior living, care, wellness, brain health, caregiving and family topics.
Forward-Looking Statements. This document may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. When the company uses words such as may, will, intend, should, believe, expect, anticipate, project, estimate or similar expressions, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties. The companys expected results may not be achieved, and actual results may differ materially from expectations. This may be a result of various factors, including, but not limited to, the satisfaction of closing conditions to the transaction, including, among other things, the obtainment of certain lender consents; the parties performance of their obligations under the transaction agreements; the receipt of applicable healthcare licenses and governmental approvals; unanticipated difficulties and/or expenditures relating to the transaction; the companys ability to enter into new joint venture agreements and management contracts; the cooperation of joint venture partners; the status of capital markets, including availability and cost of capital; changes in financing terms; competition within the health care and senior housing industries; negative developments in the operating results or financial condition of the operator/tenant, including, but not limited to, its ability to pay rent; operator/tenant bankruptcies and insolvencies; governmental regulations affecting Medicare and Medicaid reimbursement rates and operational requirements; liability or contract claims by or against the operator/tenant; issues facing the health care industry, including compliance with, and changes to, regulations and payment policies, responding to government investigations and punitive settlements and the operator/tenants difficulties in cost-effectively obtaining and maintaining adequate liability and other insurance; and changes in rules or practices governing the companys financial reporting. Additional factors are discussed in the companys Annual Report on Form 10-K and in its other reports filed from time to time with the Securities and Exchange Commission. The company assumes no obligation to update or revise any forward-looking statements or to update the reasons why actual results could differ from those projected in any forward-looking statements.
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Health Care REIT Enters Into Triple Net Lease With Emeritus Senior Living on Seniors Housing Portfolio
