Aegis Living and Oakmont Senior Living said yesterday they sold 12 housing centers for senior citizens to Health Care Property Investors...
Aegis Living and Oakmont Senior Living said yesterday they sold 12 housing centers for senior citizens to Health Care Property Investors, a publicly traded real-estate investment trust, for $256 million.
The sale and lease-back agreement, which includes two properties in Shoreline, completes Aegis’ exit from owning the buildings and land on which its business is based.
Under the lease, Aegis will pay 7.05 percent of operating income at the properties to HCP and keep any additional income. It also earns a management fee for operating the properties for HCP, said Dwayne Clark, Aegis chief executive.
The sale provides Aegis investors a “substantial” profit and a chance to cash out of the property market, said Clark, who helped found the privately held concern in Redmond eight years ago.
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“It’s a sale of the real estate, not a sale of the business,” Clark said. “We’re keeping the net income over and above the lease payment.”
Aegis has been selling its 35-property portfolio over the past two years because prices have been so attractive, Clark said. He said the sale price penciled out to 14 times the net operating income of the properties, well above industry norms of about nine times.
“In 20 years, I’ve never seen the multiples this high,” Clark said. “We got an incredible price for it.”
The cash would allow investors to continue developing properties or to make acquisitions. Clark said five more are expected to open this year. While they’ll have the Aegis banner, they’ll be owned by individuals or investors, not Aegis.
The 12 properties sold to HCP contain about 1,000 living units and are in California, Washington and Nevada. Aegis said residents won’t be aware of any change in service. Two of the properties were owned by Santa Rosa, Calif.-based Oakmont Senior Living, another private entity.
Aegis is earning about $120 million a year in net operating revenue, up from $57 million in 2003, Clark said.
HCP, which bills itself as the nations largest REIT focused on health-care properties, said in a statement it was pleased to add the properties to its other senior housing holdings.
Alwyn Scott: 206-464-3329