Brookdale Senior Living Inc. is paying $610 million to buy a total of 41 communities scattered across three different portfolios.
One of them is involved with a $300 million joint venture between Welltower Inc. to acquire 11 senior living communities, consisting of 1,228 units. Brookdale will take on $195 million debt, carrying a 4.92 percent fixed rate that is set to mature in March 2027. The communities, held in a triple lease with yearly rent payments of $22 million, are located in Seattle, Washington, and the Bay Area, California. The average occupancy rate is roughly 80 percent in this portfolio.
The Nashville, Tennessee-based firm also acquired five senior living communities, with a total of 686 units for $175 million in a separate deal from Welltower. The properties are occupied in a triple net lease, with annual rent payments of $13 million, and maturity is set for December 31, 2024. The properties are located in Nashville, Denver, and Overland Park, Kansas.
The other 25 senior living community, with 875 units, was sold by Diversified Healthcare Trust, for $135 million. The triple net lease has yearly rent payments of $10 million, with maturity scheduled for December 31, 2032. Brookdale said the properties are “diversly located” and did not reveal the specific markets.
The company expects all three of these deals, which are subject to conditions, to close by the end of the year.
Along with the acquisitions, Brookdale announced that it addressed 83 percent of its maturing 2026 debt thanks to financing led by Deerfield Management. Brookdale issued a series of convertible notes and refinanced 2025 agency debt.
To partially fund the acquisitions, the company said it is selling $150 million of 2029 New Notes to Deerfield.
“The immediate and long-term benefits of these real estate transactions are wide-ranging, including future portfolio flexibility that comes through asset ownership, the opportunity to fully realize the long-term benefits of the powerful senior housing outlook, and following closing, the expected immediate improvement in Adjusted EBITDA and Adjusted Free Cash Flow from a lower-cost capital structure,” Lucinda (“Cindy”) Baier, president and CEO of Brookdale, said.
“We appreciate Welltower, their JV partners, and DHC for their partnership on these transactions as they highlight the importance of maintaining collaborative relationships with our REIT partners as we continually strive to further enhance shareholder value.”
As of June 30, Brookdale managed and operated 649 communities in 41 states.