Source: Aviv REIT / #Senior #Housing
CHICAGO, IL - Aviv REIT, Inc. announced it has acquired five post-acute and long-term care skilled nursing facilities located in Ohio and Arkansas in two separate transactions for $42.2 million. Four of the properties are triple-net leased to new Aviv operator Peregrine Health Services and one property is triple-net leased to existing Aviv operator Concepts Management. Concepts is an operator of SNFs with 4 facilities in Arkansas. The triple-net lease with Concepts has an initial cash yield of 11.0%, an initial lease term of 10 years and annual compounded escalators based on CPI. The transaction was sourced by Concepts and brought to Aviv due to the Company's long-term relationship with Concepts.
Aviv's business development team cultivated a relationship with Peregrine over the past two years which resulted in this sale leaseback transaction. The triple-net lease has an initial cash yield of 9.9%, an initial lease term of 10 years and fixed annual escalators. Peregrine is an operator of SNFs with 16 facilities in Ohio, with over 25 years of experience operating SNFs. Aviv plans to pursue additional growth opportunities with Peregrine. We are experts at sourcing and negotiating these sale leaseback transactions. These transactions are strategic because of the alignment of interest created by the seller staying in place as the operator under a long term lease.
"We have already had an active fourth quarter closing over $90 million of acquisitions, we expect to continue to close transactions through the balance of the fourth quarter and we have continued to grow with attractive and accretive acquisitions," said Craig M. Bernfield, Chairman and Chief Executive Officer of Aviv. "We are extremely pleased with the successful execution of our recent $250 million unsecured bond offering, which has positioned us to execute on the high-quality opportunities in our pipeline. We are confident that we will continue to execute our growth strategy by focusing on quality operators, real estate and markets. We still believe that there is a significant and attractive long-term consolidation opportunity with favorable industry dynamics including SNFs being the low-cost provider of long-term and post-acute care. We believe in our competitive advantage because our management team has demonstrated its capability of sourcing and executing attractive investments over a long period of time. Aviv is committed to investing in post-acute and long-term care SNFs and looks forward to a busy 2014 and beyond."