IRVINE, Calif., May 31, 2016 (GLOBE NEWSWIRE) -- Sabra Health Care REIT, Inc. (NASDAQ:SBRA) (NASDAQ:SBRAP) announced today that the borrowers under our Forest Park Medical Center – Dallas (“Dallas”) mortgage loan filed a motion with the bankruptcy court to request approval for a sale of the Dallas real estate to an affiliate of HCA Holdings, Inc. (“HCA”).
On May 27, 2016, Forest Park Realty Partners III, LP and BT Forest Park Realty Partners, LP (collectively, the “Borrowers”) and HCA executed a purchase and sale agreement (“PSA”) whereby, subject to bankruptcy court approval and customary closing conditions, HCA will purchase the hospital real estate that serves as collateral for our Dallas mortgage loan for $135.0 million. The PSA provides for an outside date to close the sale of June 30, 2016.
As of May 30, 2016, the outstanding principal balance on the Dallas mortgage loan was $110.0 million, with $14.6 million of accrued and unpaid interest and fees. Sabra expects to fully realize all outstanding amounts upon closing of the sale, which would result in a 10.4% annualized rate of return on our investment. The $14.6 million of outstanding accrued and unpaid interest and fees consists of $2.3 million of interest previously recognized and $12.3 million of unrecognized interest and fees (unrecognized revenue of $0.19 per diluted common share). Sabra expects to use the proceeds to make additional payments on its revolving credit facility and to finance future investments.
Commenting on the developments, Rick Matros, CEO and Chairman, said, “We are pleased that the full value of our Dallas investment, including all interest earned, has been realized. Upon completion of the proposed sale and repayment of outstanding principal and interest on this investment, we will have received total cash of approximately $323.5 million over the life of our investments in the three Forest Park hospitals, which is $18.5 million greater than our total cash outlays for these investments. Our pro forma leverage, after giving effect to the acquisition of the previously announced NMS facility and to the proceeds we have realized or expect to realize from the three Forest Park hospitals, will drop to 5.17x. Although we did not realize the long term benefit we had hoped for with the Frisco hospital, our overall investment thesis has resulted in a positive outcome for what was a complex situation.”
Sabra also announced that on May 25, 2016, the borrowers under our Forest Park Medical Center – Fort Worth construction loan closed the previously announced sale of the Fort Worth hospital and medical office real estate. In connection with the closing of that sale, we received $70.7 million, which included all outstanding principal, interest and late fees under the loan. The proceeds will be used to make additional payments under our revolving credit facility.
ABOUT SABRA
Sabra Health Care REIT, Inc. (NASDAQ:SBRA) (NASDAQ:SBRAP), a Maryland corporation, operates as a self-administered, self-managed real estate investment trust (a "REIT") that, through its subsidiaries, owns and invests in real estate serving the healthcare industry. Sabra leases properties to tenants and operators throughout the United States and Canada.
FORWARD-LOOKING STATEMENTS SAFE HARBOR
This release contains "forward-looking" statements as defined in the Private Securities Litigation Reform Act of 1995. These statements may be identified, without limitation, by the use of "expects," "believes," "intends," "should" or comparable terms or the negative thereof. Forward-looking statements in this release include all statements regarding our expectations concerning our Dallas mortgage loan, including our expectations regarding the timing of closing of the sale of the Dallas real estate, the amount of and our use of net proceeds from such sale and our expected return.
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Source: Sabra Health Care REIT, Inc.