The ING Real Estate Community Living Fund is set to buy 49% interest in the $US128.2 million Cypress portfolio, on pre-cost initial yield of 7.7%.
The four seniors’ accommodation portfolio has a total of 818 units and is located in Michigan, Tennessee, Alabama and Oklahoma in the United States.
The portfolio was purchased at an 8.5% discount to the independent valuation of $US140.1 million.
ING Real Estate Investment Management’s Australia chief executive Hugh Thomson said the transaction will deliver approximately 2% from 10.5 to 10.7 cents accretion to ILF Unitholder’s distributions and materially diversify the current US Seniors portfolio from seven to 10 US states.
“The acquisition capitalises on ILF’s strategic partnership with Chartwell and provides increased exposure to the Horizon Bay Chartwell management platform which is performing very well,” he added.
ILF’s chief executive Ian Muir said the purchase the US Seniors portfolio now comprises 20 properties and a total of 3,691 units, with a total value of $US636.4 million.
“This latest portfolio is being acquired on an 8.5% discount to independent valuation, improving the NTA of the fund,” Muir added.
Following the transaction, ILF’s portfolio will comprise 96 assets with 8,632 units and a value of $812.5 million.
ILF has acquired the assets through its strategic partnership with Chartwell Seniors Housing REIT and the portfolio will be managed by the Horizon Bay Chartwell Joint Venture.
The acquisition will be funded via a two for nine non-renounceable Entitlement Offer and Public Offer to raise $63.6 million.
In addition to part funding the acquisition of the Cypress Portfolio, proceeds of the Offer will also be used to reduce Fund borrowings in Australia.
By Adam Parsons
