CareTrust REIT announced two separate acquisitions in California with a total investment amount of approximately $55 million. The investments were funded using cash on hand. First, the REIT acquired a skilled nursing and assisted living campus in Los Alamitos, California. The campus includes a 150-bed skilled nursing facility (Alamitos West Health and Rehabilitation) and a 68-unit/140-bed RCFE (Katella Senior Living Community). CareTrust’s acquisition of the campus was completed through a joint venture with a third-party healthcare real estate owner.
At closing, CareTrust provided a combined common equity and preferred equity investment totaling approximately $24 million at an initial contractual yield on its combined preferred and common equity investments in the joint venture of approximately 9.7%. The joint venture has leased the campus to affiliates of The Ensign Group pursuant to a new 15-year triple-net lease that includes two, five-year extension options and annual CPI-based escalators.
CareTrust also announced that in March the company acquired a 160-bed RCFE in Concord, California, for approximately $20.6 million, inclusive of transaction costs. The facility will be operated by, and has been added to CareTrust’s existing master lease with affiliates of Kalesta Healthcare Group. Annual cash rent for the first year is approximately $1.9 million, with CPI-based annual escalators. The investments were funded using cash on hand.
