CareTrust REIT and Cascadia Healthcare expanded their relationship to 12 facilities and 1,013 total beds with the REIT’s acquisition of a brand-new transitional care facility in Nampa, Idaho. This transaction was by no means out of the blue. Cascadia’s development affiliate opened the 99-bed facility in 2017, but before that, CareTrust had made a preferred equity investment in the property in addition to obtaining a purchase option at a formula-based price upon stabilization of the operations. Fill-up must have gone smoothly, since the property sold to CareTrust for approximately $12.8 million, inclusive of transaction costs and after receiving credit for its original equity investment and preferred returns thereon. The facility was put under an existing 12-year (plus three five-year renewal options) master lease with Cascadia, with initial annual cash rent expected to be about $1.45 million.
It doesn’t end there. Cascadia just opened another transitional care facility in nearby Boise, funded by a similar financing structure again with CareTrust. The facility is nearing stabilization, so stay tuned.