Real estate investment trust Senior Housing Properties Trust said last Friday that had finalized an agreeent to sell to third parties the New England Rehabilitation Hospital and Braintree Rehabilitation Hospital. The buyer is the Sanders Trust and the Harrison Steeet Real Estate Capital.
The tag price for the two hospitals are USD90 million. It is projected that the transaction and transfer would be completed by the middle of 2014. The expected gain when the sale is completed would reach USD30 million.
The New England Rehabilitation Hospital is located in Woburn MA while Braintree Rehabilitation Hospital is located in Braintree, MA. The hospitals became the property of SNH in 2002 and these assets are currently leased out to Five Star Quality Care Inc. As part of the transaction, FVE had agreed to terminate the lease and transfer its rights therewith to Reliant Hospital Partners LLC. Reliant would operate the hospitals until the sale is completed.
In a statement, Senior Housing Properties Trust President and COO David Hegarty said, "For more than a decade, SNH has been focused on reducing its exposure to government funded programs like Medicare and Medicaid. Upon completion of the sale of these hospitals, this plan to reduce SNH's exposure to possible future reductions in government funded Medicare and Medicaid programs will be nearly complete. SNH believes the rent reduction may be substantially offset by reinvesting the sale proceeds into additional healthcare related real estate, and any temporary reduction in earnings is more than offset by the reduced risk exposure to the politics and vagaries of government funding."
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