MEMPHIS—National Health Investors (NHI) isgetting ready to spend $476 million to acquire eight seniorhousing communities. The firm is expected to close on theSenior Living Communities Portfolio by the end of the year.

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“NHI's agreement to acquire a portfolio that includes high-endcommunities strengthens our portfolio by further diversifying oursources of rental income by operator, geography, property type andpayor source while significantly reducing our exposure togovernment reimbursement,” says Justin Hutchens,president and CEO of NHI. “This acquisition is consistent with ourconservatively funded growth strategy including partnering withexperienced senior housing operators and portfoliodiversification.”

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After the ink dries on the mega transaction, NHI will lease theeight senior housing communities to SeniorLiving Communities, LLC on a 15-year master lease. Thelease equates to an initial gross cash yield of 6.51% of thepurchase price and has annual escalators of 4% in years two throughfour and annual escalators thereafter of 3%. An affiliate of SeniorLiving Communities will manage the senior housing assets.

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NHI plans to provide a $15 million working capital line ofcredit to Senior Living Communities in connection with thesenior housing acquisition. The funding will beused to finance construction projects within the seniorhousing portfolio, including building more units at someof the communities.

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This isn't the first mega acquisition NHI has completed on thesenior housing front this year. In November, thefirm snapped up a 25-asset seniors portfolio for $491 million. The firm also soldand acquired additional skilled nursing facilitiesas part of a $23.3 million court settlement agreement in September and earlier this yearset out to build eight assisted living facilities.

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