Trust Buys 12 More Health-Care Facilities
Recovering from a painful restructuring, Nationwide Health Properties Inc. said Friday that it had purchased 12 long-term care facilities in Texas for $22 million.
“It’s a significant step forward,” said Kenneth Campbell, an analyst with Audit Investments of Montvale, N.J. “It means that (Nationwide is) back in the business again.”
Nationwide, a Newport Beach-based real estate investment trust that invests in health-care facilities, owns 94 nursing homes and rehabilitation facilities in 23 states.
The trust had been having trouble paying off a $120-million line of credit from a group of banks. Last year and early this year, it sold 26 facilities, raised $42 million in a new stock offering and completed a $33.5-million, 10-year bond sale.
The restructuring allowed the trust to reduce its long-term debt to $39 million and left it in a position to invest as much as $100 million a year over the next two or three years.
The facilities--both nursing homes and rehabilitation centers--recently have acquired a total of 1,300 beds and average 16 years in age. The 12 facilities had 10 different owners.
ARA Living Centers of Texas Inc. will run the properties, which are located throughout Texas. ARA, which operates 100 long-term care facilities in Texas, has been running the properties under their individual owners for about 10 years, according to Nationwide.
“Texas is coming back very strongly right now,” said R. Bruce Andrews, president and chief executive officer of Nationwide.
Formerly known as Beverly Investment Properties Inc., Nationwide was originally the real estate investment arm of Beverly Enterprises, a huge nursing home operator. Beverly Enterprises once owned 80% of the trust but took it public in 1985. Beverly Enterprises kept 5% of the trust and had an agreement to manage its properties.
But the nursing home company fell on hard times in recent years, and the trust’s directors ended the control agreement in 1988. Nationwide changed its name last year and moved its headquarters from Pasadena in July.
Nationwide said Friday that it has reduced from 68 to 64 the number of facilities run by Beverly Enterprises. “Our desire is to have them be no more than 20% of our portfolio,” Andrews said.
