WELL - Brookdale Senior Living leases with Welltower revised to improve liquidity

2023-05-08 17:09:17 ET

• Brookdale Senior Living ( NYSE: BKD ) said Monday its triple-net leases with Welltower ( WELL ) were revised to remove a financial covenant, provide up to $17M of additional lessor-funded capital investments, and extend a positive-covering lease.
• In each of the three leases, the net worth covenant provision was replaced with a consolidated tangible net worth covenant.
• Maturity of one positively-covering lease involving 39 communities was extended from December 31, 2026 to June 30, 2032. Maturity dates of its other leases with Welltower ( WELL ) will remain unchanged.
• A new pool of up to $17M of lessor-funded capital expenditures was made available to cover costs associated with capital projects across 69 of the leased communities.
• An initial yield of SOFR (subject to a floor of 3%) plus a margin of 4% will be applied to capex funded from the pool. These funds will be available to Brookdale ( BKD ) through December 31, 2026.
• Brookdale's ( BKD ) existing purchase options for all three Welltower ( WELL ) leases were retained, including a favorable purchase option for the lease involving five communities that may be exercised at 2024-end.
• The company also reported better-than-expected Q1 earnings.

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