Skilled Nursing Operator Orianna Files for Bankruptcy

by Jeff Shaw

NASHVILLE, Tenn. — 4 West Holdings Inc., the parent company of Nashville-based skilled nursing operator Orianna Health Systems, has filed for Chapter 11 bankruptcy.

The announcement came from Orianna’s landlord, seniors housing REIT Omega Healthcare Investors (NYSE: OHI).

“We supported Orianna’s decision to pursue a restructuring in the context of a Chapter 11 proceeding as we believe that this will ensure that the interests of the residents will be protected while at the same time providing for an orderly and balanced process that will address and definitively resolve the interests and legitimate concerns of the various constituencies involved in Orianna’s business,” says C. Taylor Pickett, Omega’s CEO.

Per the filing, 23 of the 42 Orianna facilities owned by Omega will be transferred to new operators. The remaining 19 facilities will be sold. The process is scheduled to conclude before the end of 2018.

“We continue to expect that our post-transition restructuring rent for the transition portfolio and rent equivalent for the 19 properties to be sold will ultimately be in our previously estimated range of $32 million to $38 million,” says Pickett. “We do not believe Orianna’s filing for bankruptcy protection materially affects the fair value of the facilities, and accordingly, at this time we do not expect to record further impairments on the Orianna direct financing leases as a result.”

Orianna’s facilities are located in Georgia, Indiana, Mississippi, North Carolina, South Carolina, Tennessee and Virginia.

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