The 10 assisted living facilities total 873 units and were bought by Senior Housing properties for $87.6 million in 2003. At the time of purchase, the owner simultaneously stuck a deal with NewSeasons for the full lease-up of the fresh purchase. The lease terms were $8 million per year with an annual increase for 15 years. However, New Seasons and its parent company--Philadelphia-based Independence Blue Cross--are deciding to leave the assisted living business. Senior Housing is making a deal with New Seasons and Five Star that will allow New Seasons to abdicate its lease obligations.

"[Senior Housing] was pleased to have had NewSeasons as its tenant for the past five years, but we understand that business plans of large companies may change," comments David Hegarty, president of Senior Housing, in a statement. "We expect that Five Star will be able to maintain and improve the services available at these high quality properties."

Five Star will purchase three of the facilities from the owner for $21.4 million, while taking over revised leases for the remaining seven structures. Senior Housing lowered the rental rates for Five Star in the rejuvenated leases, knocking payments down to $7.6 million annually, while removing the rate increase from the original lease.