National HealthInvestors Inc. and its joint venture partner, a Bickford SeniorLiving affiliate, agreed to convert the REIT's RIDEA portfolio to a triple-netlease structure.
Under the newagreement, National Health acquired Bickford's 15% stake in theproperties for $25.1 million, while Bickford bought National Health's 85% stakein the facilities' operations for $8.1 million.
The RIDEA portfolio comprises 32 assisted living and memory careproperties. Based on National Health's investment-to-date of roughly $298million, which the company will now fully receive, the $25.3 million base cashrent on the 32 stabilized facilities for 2016 remains intact.
National Health has five additional facilities underconstruction, including one that debuted in July, two that are set to open bythe end of 2016 and two that are scheduled for a 2017 launch. Funded amountswill be added to the lease basis during development and up to the first sixmonths after the launch, after which base rent will be charged to Bickford atan annual rate of 9%. The rent will be reset to fair market value once thefacilities are stabilized.
The terms of the 15-year triple-net lease reached betweenthe parties in May for five facilities purchased by National Health and not injected into thejoint venture remain unchanged.