LTC to Diversify Portfolio Through Transition and/or Sale of Brookdale-operated Properties

Rhea-AI Summary

LTC Properties, Inc. (NYSE: LTC), a REIT focused on seniors housing and health care properties, plans to diversify its portfolio. This decision follows Brookdale Senior Living's choice not to renew leases for 35 assisted living communities, which constitute 8.4% of LTC's pro forma annualized contractual cash rent. Brookdale remains obligated to rent payments until December 31, 2023. LTC has invested approximately $7 million in capital improvements for these properties over the past two years. The company aims to reduce operator concentration and foster growth with regional partners.

Positive

• LTC plans to diversify its portfolio, reducing concentration risk.
• The company has invested $7 million in capital improvements over the last two years.
• Brookdale will continue paying rent until December 31, 2023, ensuring cash flow.

Negative

• Brookdale's non-renewal of leases may lead to uncertainty regarding future occupancy rates.
• The transition may incur costs related to new operator partnerships.

-- Provides LTC with Opportunity to Reduce Concentration and Further Develop and Expand Relationships with Growth-Oriented Regional Operators --

WESTLAKE VILLAGE, Calif.--(BUSINESS WIRE)-- LTC Properties, Inc. (NYSE: LTC), a real estate investment trust that primarily invests in seniors housing and health care properties, today announced that it plans to diversify its portfolio through the transition and possible sale of some of the properties in its Brookdale Senior Living (“Brookdale”) portfolio, following Brookdale’s election not to exercise its lease renewal option.

Brookdale is contractually obligated to pay rent on the portfolio of 35 assisted living communities across eight states through the end of the lease term on December 31, 2023. The portfolio represents 8.4% of pro forma annualized contractual cash rent, and 8.2% of pro forma annualized GAAP rent. LTC has funded approximately $7 million in capital improvements in the properties over the last two years.

“Our relationship with Brookdale has been one of mutual respect and support, and we wish them well,” said Wendy Simpson, LTC’s Chairman and CEO. “Through LTC’s active asset management program, and as lease renewals approach, we are prepared, and have contingency plans as we have previously disclosed. We believe LTC is in an excellent position to reduce operator concentration through diversification, and look forward to working with strong regional operators to drive long-term growth and success for us and for them.”

About LTC Properties

LTC is a real estate investment trust (REIT) investing in seniors housing and health care properties primarily through sale-leasebacks, mortgage financing, joint-ventures and structured finance solutions including preferred equity and mezzanine lending. LTC’s investment portfolio includes 215 properties in 29 states with 31 operating partners. Based on its gross real estate investments, LTC’s investment portfolio is comprised of approximately 50% seniors housing and 50% skilled nursing properties. Learn more at www.LTCreit.com.

This press release includes statements that are not purely historical and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the Company’s expectations, beliefs, intentions or strategies regarding the future. All statements other than historical facts contained in this press release are forward-looking statements. These forward-looking statements involve a number of risks and uncertainties. All forward-looking statements included in this press release are based on information available to the Company on the date hereof, and the Company assumes no obligation to update such forward-looking statements. Although the Company’s management believes that the assumptions and expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. The actual results achieved by the Company may differ materially from any forward-looking statements due to the risks and uncertainties of such statements.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230227005281/en/

Mandi Hogan

(805) 981-8655

Source: LTC Properties, Inc.

FAQ

What is LTC Properties' plan following Brookdale's lease decision?

LTC Properties plans to diversify its portfolio by transitioning or possibly selling some properties in its Brookdale portfolio.

How much of LTC's revenue is affected by Brookdale's lease decision?

Brookdale's portfolio represents 8.4% of LTC's pro forma annualized contractual cash rent.

What is the current status of Brookdale's rent obligations to LTC?

Brookdale is contractually obligated to pay rent through December 31, 2023.

How much has LTC invested in its Brookdale properties recently?

LTC has funded approximately $7 million in capital improvements to its Brookdale properties over the last two years.

What is LTC's strategy for future growth after Brookdale's lease situation?

LTC aims to work with strong regional operators to drive long-term growth.