National Healthcare Investors (NYSE: NHI) announced a major transaction with Texas-based Legend Healthcare, an existing tenant. NHI has purchased eight skilled nursing facilities with 931 beds from Legend for $118.5 million, or $127,300 per bed. These will now be leased to The Ensign Group (NASDAQ: ENSG), which is a new relationship for NHI. In addition, Legend was already leasing nine SNFs from NHI, and two of these will be sold to Ensign for $24.6 million, or $100,400 per bed, and the remaining seven will be added to the new lease between Ensign and NHI, bringing Ensign’s total additional properties it is adding in Texas to 17, with 15 leased from NHI. The initial annual lease rate for the 15 will be $17.75 million, or an 8.4% initial lease rate on the total value of the new leases and the transferred leases. And the high price per bed is a result of the fact that these are relatively new, with a median age of eight years for the portfolio. Occupancy was high so these are not the typical turnaround acquisitions that we are used to seeing with Ensign.
The Ensign Group and National Healthcare Investors Score Big
