So goes another large portfolio of Holiday Retirement properties, with NorthStar Realty Finance’s acquisition of 32 independent living communities from affiliates of Harvest Facility Holdings, itself an affiliate of Holiday. The acquisition marks another step towards Holiday’s owner Fortress Investment Group’s goal of transforming Holiday into an operating company. In fact, since October 2013, Holiday has sold over 200 properties totaling about $5.1 billion. In that time, nearly all of those assets were sold to REITs, such as New Senior Investment Group, Sabra Health Care REIT, National Health Investors and Ventas, and that is no different in the most-recent transaction.
NorthStar Realty Capital (a publicly traded REIT), together with NorthStar Healthcare Income (a public, non-traded REIT) will own 60% and 40%, respectively, of the portfolio, which includes about 3,983 independent living units in 12 states. The joint venture entities will operate the portfolio as lessees or managers, and it will tap Holiday and its affiliates to manage or sub-manage some properties in the portfolio. To finance the transaction, the joint venture plans to fund between 70% and 75% of the purchase price with 10-year, fixed rate debt. Under the terms of the agreement, the buyers will have until June 30, 2015 to close the transaction, paying $875 million, or $219,700 per unit. In the other REIT sales, the price per unit has ranged from $171,600 to $268,300.