NorthStar Realty Finance Corp. (NorthStar) announced that it has entered into an agreement that will allow them to acquire a healthcare portfolio worth approximately $1.05 billion. Sold by Formation Capital and Safanad Limited, the portfolio consists of 43 primarily private-pay senior housing facilities and 37 skilled nursing facilities, which translates to over 8,500 beds in 14 different states.
NorthStar is sponsor to several non-traded REITs and with the addition of this portfolio will have over 160 healthcare properties valued at $1.6 billion.
The portfolio is being acquired indirectly through a joint venture with Formation Capital with NorthStar and its affiliates contributing 92% of the $430 million of equity to purchase the portfolio and assuming in-place financing for the remainder of the purchase price. As a private investment management firm, Formation Capital is focused on senior housing and care, post acute, and health care real estate investments.
James Flaherty, President and CEO of NorthStar’s Healthcare Income REIT commented, “This transaction represents an initial step towards our goal of expanding NorthStar’s healthcare portfolio into a preeminent healthcare real estate business. We are enthusiastic that this will be the first of many compelling transactions that we can complete with our partners at Formation Capital.”
The closing of the acquisition is expected to occur in the second quarter of 2014.