HCR ManorCare, the nursing home behemoth that operates 338 nursing homes, assisted living, and other types of senior care facilities in 30 states has agreed to sell the properties to HCP Inc. Under the terms of the $6.1 Billion deal, HCP will become owner of the facilities and lease the properties to HCR ManorCare who will continue to operate the facilities.
In 2007, Carlyle Group purchased HCR ManorCare for $6.3 billion and remains one of the largest corporations in the nursing home industry.
The deal remains one of the largest REIT deals conducted in the last few years. The acquisition of the ManorCare properties will expand HCP’s role in the senior housing market as it currently owns 250 facilities.
The rush to cash-in on nursing homes
The influx of corporate owners and operators has become a relatively recent phenomenon as various types of investors seek to capitalize on the aging population. According to reports from Bloomberg, health care is the single largest U.S. based on gross domestic product. Health-related costs are expected to continue to rise 5.1% over the next year.
Though I would never begrudge an individual or company from making a decent living, I fear the the influx of corporate nursing home owners and operators will continue to result in deteriorating care provided to patients in need as moguls evaluate new ways of deriving more income from facilities.
HCP and Carlyle’s ManorCare in $6 billion asset deal December 14, 2010 Yahoo