This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Health Care REIT Announces Agreement To Sell The Sunrise Senior Living Management Company

Health Care REIT, Inc. (NYSE:HCN) announced today that in connection with its previously announced acquisition of Sunrise Senior Living, Inc. (NYSE:SRZ), affiliates of Kohlberg Kravis Roberts & Co. L.P. (together with its affiliates, “KKR”), affiliates of Beecken Petty O’Keefe & Company (“BPOC”) and Coastwood Senior Housing Partners LLC have entered into a definitive agreement to acquire the management company business of Sunrise Senior Living for approximately $130 million. Health Care REIT will invest approximately $26 million for a 20% interest in the new entity. Under the agreement, the sale will close immediately prior to Health Care REIT’s previously announced acquisition of Sunrise Senior Living.

“The acquisition of the management business by a partnership with substantial expertise in both health care and real estate, that includes KKR, BPOC and Coastwood, powerfully endorses the Sunrise value proposition,” said George L. Chapman, Health Care REIT’s Chairman and Chief Executive Officer. “The backing of Sunrise management ensures a stable and growing management platform that aligns perfectly with our long-term value creation expectations.”

The management business being sold will include existing Sunrise management contracts covering 282 communities, which includes the 125 communities to be acquired by Health Care REIT, leasehold interests in 15 communities and 12 development parcels. In addition, a subsidiary of the Sunrise management partnership will employ all employees of Sunrise Senior Living and operate under the “Sunrise” name and brand. Immediately following the completion of the sale of the management company, Health Care REIT will proceed with the acquisition of Sunrise Senior Living, including its interest in 125 senior living communities.

The Sunrise management partnership has agreed that the management company entity will reduce the base management fees charged on the originally announced 20 wholly owned communities to 5.0% of revenues, which will be adjusted upwards or downwards depending on achievement of net operating income performance hurdles. The Sunrise management partnership further agreed that the management company entity will reduce the base management fees on the originally announced 105 joint venture communities, as joint venture partners are bought out and the properties become wholly owned, to the lesser of the current management fee or 5.5% of revenues, which will be adjusted upwards or downwards depending on achievement of net operating income performance hurdles.

1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,868.28 -108.03 -0.60%
S&P 500 2,077.60 -8.64 -0.41%
NASDAQ 4,924.7410 -22.70 -0.46%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs