National Health Investors has closed on the sale of eight senior living communities consisting of 909 units formerly leased to Holiday Retirement for gross proceeds of $115 million, the real estate investment trust said in a business update Friday.
The REIT said it expects to see a gain of approximately $1 million to $2 million on the sale. Rental income on the properties for the first half of the year was $4.2 million.
Earlier this month, on a second-quarter earnings call, the company had announced that it had signed a non-binding letter of intent in July to sell a portfolio of nine Holiday properties to an institutional buyer.
NHI said Friday that it still is “considering alternatives” for 18 other properties, “which could result in a range of outcomes, including a lease restructuring, re-tenanting, or further asset sales.”
Also, NHI said that rent deferments from Bickford Senior Living total $12.75 million so far this year, including $1 million for rent due in August. The REIT said it deferred approximately $0.8 million for three other tenants in August; those tenants are expected to repay the sums with interest.
Adjusting for the sale of the eight Holiday properties, NHI had collected 81% of contractual cash due for August as of Friday. NHI’s tenant for Holiday was recently acquired, and NHI has yet to receive any payment for August from the new tenant. NHI said it continues to hold $8.8 million in Holiday security deposits.
The outstanding balance for August consists of 1.9% of contractual cash, which NHI expects to still collect this month; 3.7% in deferrals related to Bickford; 3% in deferrals related to three other tenants; 9.8% related to Holiday’s August rent; and 0.6% related to lower forecasted revenue from transitioned properties prior to the start of the pandemic. NHI has collected $0.03 million in previously deferred rent from one tenant during August that is not reflected in the reported percentage of contractual cash collected.
Third-quarter contractual cash collections to date are approximately 85%, the REIT said.