Care Capital Properties Acquires Six Behavioral Health Hospitals for $400M

|By:, SA News Editor

Care Capital Properties (NYSE:CCP) entered into a definitive agreement to acquire six behavioral health hospitals in a sale-leaseback transaction for $400M having a total of 712 beds.

The company plans to fund up to $50M in capital expenditures to finance expansion and improvements in the portfolio.

Upon completion of the transaction in 2Q17, the company will lease the properties to affiliates of Signature on a ten-year triple-net basis, with five renewals of five years each, initial GAAP yield on the transaction is expected to be approx. 8.7%, and the investment was underwritten at 1.5x EBITDAR coverage on cash rent.

“This accretive transaction will enable us to efficiently recycle capital from our dispositions and diversify our portfolio into a new industry sector with a strategic operator, favorable investment attributes and strong cash flows.” said Raymond J. Lewis , CEO.