LOUISVILLE, KY – Ventas Inc., a real estate investment trust, has sold 22 underperforming facilities to Kindred Healthcare Inc. for $175 million.
The properties include 21 skilled nursing facilities with 2,634 beds and one long-term acute care hospital in urban Detroit with 220 beds. Kindred Healthcare paid $171.5 million to buy the facilities and a lease termination fee of $3.5 million.
Kindred Healthcare reported that it had been renting the facilities for $10.3 million annually from the Louisville, Ky.-based Ventas.
The facilities had lost approximately $10 million for the year ending Dec. 31, 2006, said a spokesman for Kindred Healthcare, a Louisville-based long-term care company.
Kindred Healthcare executives said they expect to sell the facilities as quickly as possible. They expect to generate $80 million to $90 million from their sale, and after tax benefits are added in, they expect an out-of-pocket loss of $46 million to $52 million.
“We are focused on disposing of these facilities as soon as possible,” said Paul J. Diaz, president and CEO of Kindred Healthcare. “Completing this transaction allows us to divest these operating losses and reposition our portfolio to focus on our cluster market strategic growth opportunities.”
Ventas executives said the sales strengthen their portfolio of facilities and the company’s financial position. Specifically, they expect to pay down debt incurred as interim financing in acquiring the facilities previously owned by Sunrise Senior Living REIT.
Ventas still leases about 50 skilled nursing facilities and eight long-term acute care hospitals to Kindred Healthcare.