OAK CREEK, Wis. — National Health Investors Inc. (NYSE: NHI) has agreed to finance development of Ignite Medical Resort Oak Creek, a 144-bed skilled nursing facility just south of Milwaukee in Oak Creek. NHI's commitment totals $25.4 million.
Construction on the facility is underway, with an expected completion of second-quarter 2020.
The loan comes with a 9.5 percent yield, which will be capitalized into NHI’s investment. A 12-year lease term begins post-construction with two 10-year renewals and a 2 percent annual escalator. In addition, there is a $2 million earn-out based on the operator meeting certain operating metrics in 2024 and 2025.
A tenant entity owned by affiliates of Villa Healthcare and Ignite Medical Resorts will operate the community once completed.
“We are excited to enter into a new relationship with Villa and Ignite, under a newly formed entity by principals with extensive experience operating large portfolios of skilled nursing facilities and strong relationships in the market area,” says Eric Mendelsohn, NHI’s president and CEO. “We believe this new relationship will provide an excellent opportunity to expand our presence in this market.”