Tuesday, December 26, 2017

ManorCare Gets Rent Discount while Restructuring

Reuters reported:

Healthcare property owner Quality Care Properties Inc has agreed to cut rents for HCR ManorCare but said the U.S. nursing home chain, which already owes more than $300 million in back rent, has acknowledged it will struggle to pay even the reduced amount, according to a regulatory filing on Tuesday. 

Under the deal, which includes a one-year forbearance agreement, Quality Care reduced monthly rents under ManorCare’s master lease to $23.5 million through Nov. 30, 2018 while the two companies discuss a broader restructuring. 
In 2010 Carlyle sold ManorCare's nursing home facilities at a premium price, $6.1 billion, and committed to monthly lease payments of $39.5 million.

Carlyle Partners V bought ManorCare in December of 2007 and news reports had Carlyle ceding control of ManorCare this past summer.  However, The Carlyle Group's website shows ManorCare as a current investment. 

Update 2-1-18:  ManorCare owes more than $300 million in back rent and continues falling further behind.  QCP may put Carlyle's struggling affiliate into receivership.