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CNL Healthcare Properties to Purchase Portfolio of Hospitals

According to an SEC filing by CNL Healthcare Properties (CNL Healthcare), the non-traded REIT sponsored by CNL Financial Group is set to acquire a hospital portfolio.

Through CHP Partners, CNL Healthcare’s operating partnership, the REIT entered into purchase and sale agreements to acquire three post-acute care rehabilitation hospitals for an aggregate purchase price of approximately $68.0 million and two acute care surgical hospitals for an aggregate purchase price of approximately $63.1 million.

The company determined on June 17 2014, that the acquisition of the portfolio was likely to take place due to the expiration of the due diligence period, the approval of the acquisitions by its board of directors and because its money deposit on the properties became non-refundable.

The portfolio consists of four single-tenant buildings and one multi-tenant building with an aggregate of 295,304 square feet and 180 beds. The average age of the facilities is five years.

The hospitals in the portfolio are Mercy Rehabilitation Hospital Oklahoma City, OK, Desert Canyon Rehabilitation Hospital in Las Vegas, NV, St. Joseph Rehabilitation Hospital in Mishawaka, IN, Victory Surgical Hospital – Beaumont in Beaumont, TX, and Victory Surgical Hospital – Mid-Cities in Hurst, TX.

The company intends to finance approximately $85.5 million of the acquisition and fund the balance with cash. The company may draw on amounts available under its revolving line of credit with Keybank, N.A. The company will also pay its advisor, CNL Healthcare Corp. an investment services fee of approximately $2.4 million upon closing.

The rehabilitation hospitals are expected to close in July and the surgical hospitals are expected to close in August.