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Brookdale makes $1.2B community management deal

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A big long-term care (LTC) provider is setting up a retirement community joint venture with a real estate investment trust (REIT).

The LTC provider, Brookdale Senior Living (NYSE:BKD), is making the continuing care retirement community (CCRC) deal with HCP Inc. (NYSE:HCP).

Brookdale already runs independent living communities, assisted living facilities, dementia-care communities and CCRCs that house about 67,000 people. It hopes to add 46,000 beds when it completes a pending acquisition of Emeritus Senior Living Corp. (NYSE:ESC).

HCP, a health REIT, owns 202 of the senior communities that Emeritus leases and manages.

The Brookdale-HCP joint venture agreement calls for Brookdale to put eight of its properties in the venture.

HCP would add three properties and pay $334 million to buy four other CCRCs that Brookdale manages for other parties. HCP and Brookdale would also put those four CCRCs in the venture.

Brookdale would own 51 percent of the venture and HCP 49 percent.

The 14 properties have a total value of about $1.2 billion, the companies estimate.

The 7,000 units in the properties get 67 percent of their business from people who can live on their own, without significant help; 18 percent who are getting skilled nursing care; 11 percent who are in assisted living facilities; and 4 percent who need memory care.

HCP also would let Brookdale take over management of the senior communities that Emeritus has been managing.

Brookdale and HCP hope to close on the transactions after Brookdale completes the Emeritus acquisition.

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