CareTrust REIT Acquires Two AdventHealth Skilled Nursing Facilities

by Jeff Shaw

BURLESON, Texas, and OVERLAND PARK, Kan. — CareTrust REIT Inc. (NYSE: CTRE) has acquired two skilled nursing facilities: AdventHealth Care Center Burleson, a 178-bed facility in Burleson, and AdventHealth Care Center Overland Park, a 102-bed facility in Overland Park, Kansas. The Overland Park facility represents CareTrust’s entry into the Kansas market.

Blueprint Healthcare Real Estate Advisors represented the seller, AdventHealth, in the transaction.

The acquisition of the Burleson facility will be an add-on to CareTrust’s existing lease with Austin, Texas-based operator Momentum Skilled Services, which will replace the outgoing operator. The Burleson acquisition increases CareTrust’s relationship with Momentum to two facilities.

In connection with the acquisition of the Overland Park facility, CareTrust has entered into a new tenant relationship with an affiliate of Summit Healthcare Management, a new Kansas-based skilled nursing operator owned by Ben Bryant, an experienced operator of skilled nursing and seniors housing facilities in the Midwest.

CareTrust’s initial investment in the facilities, inclusive of capital expenditure commitments and transaction costs, was approximately $17.2 million. Initial annual cash rent for the facilities will be approximately $1.6 million. The initial term of Momentum’s master lease with CareTrust was also extended by four years in connection with the transaction. The lease with Summit Healthcare provides for an initial term of 15 years with two five-year renewal options and includes annual, CPI-based escalators.

The acquisition was funded using cash-on-hand.

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