CareTrust REIT Inc. (NYSE: CTRE) said it acquired a $400 million skilled nursing portfolio in the U.S. southwest effective Sept. 1, investing approximately $380 million through a joint venture arrangement.
The portfolio comprises 2,622 licensed skilled nursing beds and is triple-net leased to the existing operator under a long-term lease featuring annual inflation-based rent escalators and multiple renewal options, according to the company. James Callister, CareTrust's chief investment officer, said the portfolio is expected to generate a stabilized yield of approximately 8.6%.
The acquisition was funded using cash on hand and proceeds from the settlement of equity forward contracts. Unsettled forward equity contracts carry expected net proceeds of $439 million, the company said. CareTrust also cited remaining capacity of $612 million under its at-the-market equity program and $725 million in revolver availability.
The deal marks the latest in a series of acquisitions that have pushed the company well past its prior full-year capital deployment record with more than a quarter of the year remaining, President and CEO Dave Sedgwick said.
Total third-quarter investments stood at approximately $710 million, including a mid-August care home acquisition in the United Kingdom. Year-to-date investments reached $1.9 billion across two dozen transactions at a blended stabilized yield of approximately 8.7%, the company said.
CareTrust reported an investment pipeline of approximately $600 million in near-term opportunities, roughly half of which would be in the company's senior housing operating portfolio.
