Senior Housing Properties Makes Progress on $900M Disposition Plan

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NEWTON, MA—Senior Housing Properties Trust closed on $207.8 million in property sales during the fourth quarter of 2019 as part of its previously announced plan to sell up to $900 million of properties in connection with its restructuring agreement with Five Star Senior Living. The REIT also recently acquired a 169-unit active adult rental property in Plano, Texas for $50.3 million.

The restructuring plan was announced earlier this year. Effective Jan. 1, 2020, the existing five master leases for 184 of SNH’s senior living communities (19,979 living units) that are leased to Five Star as well as the existing management agreements and pooling agreements with Five Star for 77 of SNH’s senior living communities (10,135 living units) will be terminated and replaced with new management agreements for all 261 Five Star operated senior living communities.

As part of the deal, SNH expects to sell properties valued at up to $900 million to reduce its leverage. SNH plans to focus primarily on selling underperforming senior living communities and non-healthcare related assets, including standalone skilled nursing facilities and wellness centers. SNH has sold, or currently has under agreement to sell, approximately $678 million of properties. The REIT also has an additional $231 million of properties with offers from prospective buyers.

Also during the fourth quarter of 2019, SNH acquired a 169-unit active adult rental property built in 2016 in Plano. SNH funded this acquisition with proceeds from its sales and its $1 billion unsecured revolving credit facility.

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