NorthStar Healthcare Income Inc., a non-traded real estate investment trust sponsored by NorthStar Asset Management (NYSE: NSAM), in a joint venture with Formation Capital LLC and Safanad Management Limited, recently completed the acquisition of Extendicare International Inc., including a portfolio of 158 senior housing and care facilities for total cost of approximately $1.1 billion. NorthStar indirectly owns 36.67 percent of the joint venture which completed the acquisition.
The Extendicare portfolio consists of 152 skilled nursing facilities and six assisted living facilities that total more than 15,000 beds. The properties are located across 12 states, with the largest concentrations in Indiana, Kentucky, Ohio, Michigan and Wisconsin. As of March 31, 2015, the portfolio’s overall resident occupancy rate was approximately 83 percent. In connection with the acquisition, NorthStar Healthcare Income originated a $75 million mezzanine loan to fund their share of the Extendicare acquisition and the mezzanine loan, and invested approximately $130.0 million with proceeds from their public offerings of common stock.
The joint venture assumed: $527.2 million of HUD debt, a $98.4 million senior secured loan by The PrivateBank and Trust Company, and a $60.0 million first lien senior secured loan with General Electric Capital Corporation. Additionally, the joint venture directly or indirectly entered into an $87.3 million second lien senior secured loan with GE, as well as the $75 million mezzanine loan funded directly by NorthStar Healthcare Income.