TOLEDO, OH—Health Care REIT said Thursday afternoon that its acquisition pipeline for the second half of the year would total $1.7 billion, mainly in the seniors health and housing segments. To that end, the Toledo, OH-based REIT on Friday priced a stock offering that could raise more than $1 billion.
HCN has priced the offering of 15.5 million common shares at $63.75, and will give the underwriters an option to purchase up to 2,325,000 additional shares. That would yield up to $1.1 billion, which the REIT plans to use to repay debt and acquire properties.
An SEC filing on Thursday did not specify a delivery date for the shares. Goldman Sachs, RBC Capital Markets, BofA Merrill Lynch, Citigroup, Deutsche Bank Securities, J.P. Morgan and Morgan Stanley are acting as joint book-running managers for the offering. This past June, HCBN completed an offering of similar size, selling 16.1 million shares at $62.35 per share.
The REIT is basing its projections of completing $1.7 billion in deals during the third and fourth quarters on the tally of acquisitions it has already completed in this quarter and potential buys for which it has signed a letter of intent. These include its $950-million acquisition of Canada-based HealthLease Properties REIT, which GlobeSt.com reported last month, and its partnership with Sunrise Senior Living on the 11 UK seniors housing communities the two companies bought from Gracewell Healthcare for $257 million. HCN also has $535 million in future acquisitions on the boards.
All told, HCN is expecting to have acquired approximately $597 million of post-acute and long-term care properties, $468 million of seniors housing triple-net lease properties, $371 million of seniors housing operating properties and $306 million of medical office properties by year's end. Excluding the HealthLease acquisition, about 71% of these deals are expected to involve existing portfolio partners including Sunrise, Genesis HealthCare, Senior Resource Group and Avery Healthcare. The aggregate anticipated acquisition amount includes the assumption of about $236 million in debt at an average annual interest rate of 4.5%.
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more inforrmation visit Asset & Logo Licensing.
Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
