Health Care REIT (NYSE:HCN) agrees to the purchase of HealthLease Properties Real Estate Investment Trust for CAD$14.20 in cash, with the deal valued at about $950M. The HealthLease portfolio includes 53 seniors housing, post-acute care, and long-term care communities. The purchase price represents a 7% initial cash yield and HCN expects it to accretive to FFO per share by about $0.04 in year one.
HCN also agrees to a partnership with Mainstreet Property Group - the external management company of HealthLease. The deal includes an agreement to acquire 17 state-of-the-art Next Generation communities for about $369M, representing a 7.5% initial cash yield which is expected to be meaningfully accretive. The purchases are expected to close in tranches upon completion of construction beginning in Q4 of this year through Q1 of 2016.
There's also an agreement for HCN to provide mezzanine financing and receive purchase rights for another 45 Next Generation projects.