NEWPORT BEACH, Calif., June 10 /PRNewswire-FirstCall/ -- Nationwide Health Properties, Inc. today announced that it has entered into a new master lease with Senior Services of America (SSA) with respect to the former "lease up" Balanced Care portfolio. SSA took over the operations of that portfolio in 2001 under stabilization master leases that generated cash rent of about $2 million in 2003. SSA has since successfully stabilized the portfolio, with resident occupancy currently at 87%, and evidenced its confidence in the portfolio's future by entering into the new master lease containing NHP's standard market terms and conditions (including a $1 million security deposit/personal guaranties and property tax and capital expenditure impounds). Rent will continue to be recognized on a cash basis, with cash rent for the first year of $3,700,000 and annual fixed increases equal to 4.7% in year two, 10.6% in year three, 9.6% in year four, 8.7% in year five and 3% per year thereafter over the remainder of the 12-year initial term.
"We are very pleased that SSA not only has been able to stabilize this portfolio, but also has expressed its confidence and commitment by stepping up to a market rent on our standard terms going forward," said Donald D. Bradley, Senior Vice President and Acting Chief Investment Officer. "This improvement reflects our increased focus on internal growth and is already included in our standing FFO guidance for 2004."
Nationwide Health Properties, Inc. is a real estate investment trust that invests in health care facilities. The Company has investments in 402 facilities in 39 states. For further information go to http://www.nhp-reit.com/.
Certain information contained in this news release, especially that related to the lease described above, includes forward-looking statements. Forward-looking statements include statements regarding our expectations, beliefs, intentions, plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements which are not statements of historical facts. These statements may be identified, without limitation, by the use of forward looking terminology such as "may," "will," "anticipates," "expects," "believes," "intends," "should" or comparable terms or the negative thereof. All forward-looking statements included in this news release are based on information available to us on the date hereof. These statements speak only as of the date hereof, and we assume no obligation to update such forward-looking statements for any reason or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. These statements involve risks and uncertainties that could cause actual results to differ materially from those described in the statements. These risks and uncertainties include (without limitation) the following: failure to negotiate acceptable definitive documentation or consummate one or more of the expected closings due to the inability to obtain third party consents or otherwise; continued deterioration of the operating results or financial condition, including bankruptcies, of our tenants; occupancy levels at certain facilities; changes in the ratings of our debt securities; access to the capital markets and the cost of capital; government regulations, including changes in the reimbursement levels under the Medicare and Medicaid programs; the general distress of the healthcare industry; the effect of economic and market conditions and changes in interest rates; the amount and yield of any additional investments; the ability of our operators to repay deferred rent or loans in future periods; the ability of our operators to obtain and maintain adequate liability and other insurance; our ability to attract new operators for certain facilities; our ability to sell certain facilities for their book value; changes in tax laws and regulations affecting real estate investment trusts; and the risk factors described in our annual report on Form 10-K filed with the SEC on March 9, 2004.
For further information, please contact Donald D. Bradley, SVP & Acting CIO, or Mark L. Desmond, SVP & CFO, both of Nationwide Health Properties, Inc., +1-949-718-4400.
Nationwide Health Properties, Inc.CONTACT: Donald D. Bradley, SVP & Acting CIO, or Mark L. Desmond, SVP &CFO, both of Nationwide Health Properties, Inc., +1-949-718-4400
Web site: http://www.nhp-reit.com/