CareTrust REIT (NYSE: CTRE) announced Tuesday an approximately $400 million acquisition of a large portfolio of skilled nursing facilities with more than 2,600 beds in the Southwest.
The facilities are located in markets where both CareTrust and the operator have established scale and extensive operating experience, a press release for the California-based real estate investment trust (REIT) stated.
Effective Sept. 1, the portfolio includes 2,622 licensed skilled nursing beds and is triple-net leased to the existing operator under a long-term agreement with annual inflation-based rent escalators and multiple renewal options.
“This is exactly the kind of meaningful transaction we’ve built our platform to facilitate: a large, high-quality portfolio in core markets, an off-market process, and with an operator we know well and have tremendous confidence in,” said Joe Callan, senior vice president of investments.
The off-market transaction was completed through a joint venture, with CareTrust investing roughly $380 million.
“This one is right down the middle of the fairway for us and took careful execution at every stage from inception to closing. As we continue to grow across all three of our growth engines, activity in skilled nursing remains robust, and this transaction is a great example of why we remain so constructive on the space,” Chief Investment Officer James Callister said in a press release, noting that his company expects the portfolio to generate a stabilized yield of approximately 8.6%.
The latest acquisition was funded with cash on hand and proceeds from the settlement of equity forward contracts. CareTrust has approximately $439 million of expected net proceeds from unsettled forward equity contracts, $612 million of remaining capacity under its at-the-market equity program and $725 million of availability under its revolving credit facility.
Dave Sedgwick, CEO and president, said that following this transaction, CareTrust’s investment pipeline stands at approximately $600 million of near-term, actionable opportunities, roughly half of which would sit in the company’s senior housing operating portfolio (SHOP) platform.
“Today’s pipeline figure does not include a number of promising larger portfolio transactions we are actively pursuing. We are equally excited about finishing 2026 strong and the set up for 2027,” he added.
Including the latest acquisition, CareTrust has closed approximately $710 million of investments in the third quarter-to-date, which also includes a small care home acquisition in the United Kingdom in mid-August. The REIT’s 2026 year-to-date investment total now stands at $1.9 billion across two dozen transactions at a blended stabilized yield of approximately 8.7%.
“[This] pushes us past our prior full-year record for capital deployment with more than a quarter of the year still to play,” Sedgwick said. “All three of our growth engines are firing, our balance sheet is in excellent shape, and we intend to finish the year strong.”
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