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Griffin-American Inks $1.1 Billion Deal

Griffin-American Healthcare REIT III Inc., a publicly registered non-traded real estate investment trust sponsored by American Healthcare Investors and Griffin Capital Corp., has entered into a definitive agreement to acquire Trilogy Investors LLC, the parent company of Trilogy Health Services LLC, for approximately $1.125 billion pursuant to a joint venture with NorthStar Healthcare Income Inc.

Jeffrey Hanson, Chairman and CEO Griffin-American Healthcare REIT III
Jeffrey Hanson
Chairman and CEO
Griffin-American Healthcare REIT III

Griffin-American will own 70 percent of the joint venture and will act as its manager, while NHI will own 30 percent. As part of the transaction, Randy Bufford, Trilogy’s founder and chief executive officer, and other members of Trilogy’s management will maintain an investment of approximately $24 million in the company.

“This is a transformational event for Griffin-American Healthcare REIT III, which will nearly double in size upon the completion of the Trilogy acquisition to approximately $2 billion in real estate and real estate-related investments,” said Jeff Hanson, chairman, chief executive officer and one of the largest stockholders of Griffin-American Healthcare REIT III. “Randy Bufford and his executive team, which will continue to manage the Trilogy assets on behalf of the joint venture, have established themselves as one of the premier providers of long-term senior care in the country.”

Founded in 1997, Trilogy is an owner-operator of purpose-built integrated senior healthcare campuses throughout the states of Indiana, Ohio, Michigan and Kentucky that offer assisted living, memory care, independent living and skilled nursing services. The company operates a total of 96 properties comprised of more than 10,000 beds, most of which were either built or substantially renovated in the past 10 years.

The transaction is subject to third party approvals, customary closing conditions and the satisfaction of other requirements as detailed in the agreement. The investment has been structured with the intention of complying with the REIT Investment Diversification and Empowerment Act of 2007 (“RIDEA”).

CS Capital Advisors LLC acted as financial advisor to Griffin-American and NHI. Paul, Weiss, Rifkind, Wharton & Garrison LLP served as lead legal advisors to the joint venture, while Morris, Manning & Martin, LLP acted as legal advisors to Griffin-American.

Griffin-American Healthcare REIT III Inc. invests in a diversified portfolio of healthcare real estate assets, focusing primarily on medical office buildings, hospitals, skilled nursing facilities, senior housing and other healthcare-related facilities. As of August 14, 2015, the company has acquired a diversified portfolio of healthcare assets totaling 67 buildings and one collateralized debt instrument for an aggregate purchase price of approximately $1.03 billion.