Brookdale Senior Living Announces Acquisition and Financing Transactions

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Feb 14, 2012, 09:14 ET

NASHVILLE, Tenn., Feb. 14, 2012 /PRNewswire/ -- Brookdale Senior Living Inc. (NYSE: BKD) (the "Company") today announced that it has recently completed the acquisition of nine communities with a total of 1,295 units for an aggregate purchase price of $121.3 million, plus customary transaction expenses. The communities had previously been operated by the Company under long-term leases that were accounted for as operating leases.

"Acquiring these communities gives us the opportunity to move forward with renovating and repositioning these assets to improve their financial performance. By owning these assets outright, we will capture the assets' entire value creation potential and preserve important optionality with respect to these assets, including the ability to expand some of these communities if we decide to do so or to dispose of those that may not fit our long-term strategy," said Bill Sheriff, Brookdale's Chief Executive Officer.

The Company financed the transaction with $77.9 million of first mortgage financing secured by seven of the communities and $15.0 million of seller-financing secured by two of the communities. The $77.9 million first mortgage facility has a ten year term. 75% of the facility bears interest at a fixed rate of 4.21% and the remaining 25% of the facility bears interest at a variable rate of 30 day LIBOR plus a margin of 276 basis points. The $15.0 million mortgage loan has a two year term and bears interest at a fixed rate of 7.0%.

Additionally, the Company announced that it had obtained a $63.0 million first mortgage loan secured by one of the Company's communities. The loan has a five year term and bears interest at a variable rate of 30 day LIBOR plus 300 basis points. In connection with the transaction, the Company repaid a $62.8 million first mortgage loan that was scheduled to mature in 2013. The refinancing transaction represents another step in the process of the Company's plan for addressing its 2013 debt maturities.

About Brookdale Senior Living

Brookdale Senior Living Inc. is a leading owner and operator of senior living communities throughout the United States. The Company is committed to providing an exceptional living experience through properties that are designed, purpose-built and operated to provide the highest-quality service, care and living accommodations for residents. Currently the Company operates independent living, assisted living, and dementia-care communities and continuing care retirement centers, with 646 communities in 36 states and the ability to serve approximately 67,000 residents.

Safe Harbor

Certain items in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Those forward-looking statements are subject to various risks and uncertainties and include all statements that are not historical statements of fact and those regarding our intent, belief or expectations, including, but not limited to, all statements regarding our plans to renovate and reposition the acquired communities, our expectations concerning the future performance of the acquired communities, our ability to secure financing or repay, replace or extend existing debt at or prior to maturity and our expectations regarding financings and refinancings of assets and their effect on our results. Words such as "expect(s)" and similar expressions are intended to identify such forward-looking statements. These statements are based on management's current expectations and beliefs and are subject to a number of factors that could lead to actual results materially different from those described in the forward-looking statements. We can give no assurance that our expectations will be attained. Factors that could cause actual results to differ materially from our expectations include, but are not limited to, the risk that we will be unable to improve the communities' results of operations and cash flows, the risk associated with the current global economic crisis and its impact upon capital markets and liquidity, the risk that we may not be able to extend (or refinance) debt as it matures, the possibilities that changes in the capital markets, including changes in interest rates and/or credit spreads, or other factors could make financing more expensive or unavailable to us, our ability to obtain additional capital on terms acceptable to us, and the other risks detailed from time to time in our filings with the Securities and Exchange Commission. Such forward-looking statements speak only as of the date of this press release. We expressly disclaim any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or change in events, conditions or circumstances on which any statement is based.

SOURCE Brookdale Senior Living Inc.