CareTrust REIT Acquires 4-Facility, 396-Bed Skilled Nursing Portfolio

Strategic Insights -

CareTrust REIT, Inc. (NYSE:CTRE) has announced the acquisition of a 4-facility, 396-bed skilled nursing portfolio in the Mid-Atlantic for approximately $74.7 million, inclusive of transaction costs. This investment represents a significant expansion of the company's portfolio and further solidifies its position in the skilled nursing and seniors housing sectors.

The portfolio includes a skilled nursing and assisted living campus with 47 assisted living units. The company has entered into a triple-net master lease with a new operator, which has an initial term of 15 years with two, 5-year extension options, providing a year 1 contractual lease yield of 9.3%. This lease also includes annual CPI-based escalators.

Key Takeaways:

  • CareTrust REIT has acquired a 4-facility, 396-bed skilled nursing portfolio in the Mid-Atlantic for approximately $74.7 million, inclusive of transaction costs.
  • The portfolio includes a skilled nursing and assisted living campus with 47 assisted living units.
  • The company has entered into a triple-net master lease with a new operator, which has an initial term of 15 years and includes a year 1 contractual lease yield of 9.3%.
  • The lease also includes annual CPI-based escalators.
  • The acquisition represents a significant expansion of the company's portfolio and further solidifies its position in the skilled nursing and seniors housing sectors.
  • The company has a reloaded investment pipeline of $240 million in near-term, actionable opportunities, not including larger portfolios the company is reviewing.
  • CareTrust REIT is currently in the process of amending and extending its existing credit facility, with approximately $280 million of cash on hand.
  • The company's outstanding share count stands at 171.5 million shares, following the September 2024 raise of $309.9 million at an average price of $30.38 per share under its new $750 million ATM program.
  • The company has also paid off its $200 million term loan, leaving it with a strong financial position to pursue further acquisition opportunities.

Statistics:

  • $74.7 million: The total investment amount for the acquisition of the 4-facility, 396-bed skilled nursing portfolio.
  • 4: The number of facilities acquired as part of the portfolio.
  • 396: The total number of beds in the acquired portfolio.
  • 47: The number of assisted living units at the skilled nursing and assisted living campus.
  • 15 years: The initial term of the triple-net master lease with the new operator.
  • 2, 5-year extension options: The options available for extension of the master lease.
  • 9.3%: The year 1 contractual lease yield under the master lease.
  • $309.9 million: The amount raised under the new $750 million ATM program in September 2024.
  • $30.38: The average price per share for the September 2024 raise.
  • 171.5 million: The current outstanding share count of CareTrust REIT.
  • $200 million: The amount of the term loan that was paid off in September 2024.
  • $280 million: The amount of cash on hand at CareTrust REIT as of the current date.
  • $240 million: The reloaded investment pipeline of near-term, actionable opportunities.

Sources:

  • Businesswire.com (https://www.businesswire.com/news/home/20241003290692/en/) - News release announcing the acquisition of the 4-facility, 396-bed skilled nursing portfolio.