The properties, previously operated by a subsidiary of Marriott International, were acquired for the subsequent lease by a joint venture that includes Fremont Realty Capital, a San Francisco based fund. An investor group led by Dan Baty, CEO of Emeritus, has a minority interest in the joint venture.
The lease is for an initial 10-year period with two 5-year extensions and includes an option to buy the properties after the third year and the right (under certain circumstances) for the landlord to cancel the lease by payment of a termination fee after the fifth year.
GlobeSt.com has put in a call to Emeritus CFO Ray Brandstrom to find out the value of the lease agreement, the third-year optional purchase price and the fifth-year termination fee. It will be added to this story when it is made available. "This is the largest single acquisition we have completed," says Brandstrom in a prepared statement.
Since the first of the year, Emeritus says it has increased the number of communities managed by 47, representing an increase in total capacity of approximately 5,000 residents or 35%. Fremont Realty is a part of the Fremont Group, a San Francisco based private investment company.
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