Griffin-American Healthcare REIT IV Reports Fourth Quarter and Year-End 2017 Results
IRVINE, Calif. (March 12, 2018) – Griffin-American Healthcare REIT IV, Inc. today announced operating results for the company’s fourth quarter and year ended Dec. 31, 2017.
“Griffin-American Healthcare REIT IV expanded significantly during 2017, acquiring more than $327 million of quality healthcare real estate on behalf of our fellow investors,” said Jeff Hanson, chairman and chief executive officer. “We have now acquired a portfolio approaching half a billion dollars1 in value.”
Chief financial officer Brian Peay added, “Our portfolio performed very well during 2017, with a healthy weighted average remaining lease term and growing net operating income and modified funds from operations.”
2017 Highlights and Accomplishments
Central Wisconsin Senior Care Portfolio was acquired from Waunakee Manor, a Limited Partnership and Sun Prairie Associates Limited Partnership, unaffiliated third parties represented by William Mulligan, Nicholas Glaisner and Ashley Wilkens of Ziegler Investment Banking.
Griffin-American Healthcare REIT IV purchased its first property in June 2016 and, as of the date of acquisition of Central Wisconsin Senior Care Portfolio, has acquired a portfolio of 42 medical office buildings, senior housing facilities and skilled nursing facilities for an aggregate contract purchase price of approximately $489 million.
About American Healthcare Investors, LLC
- Modified funds from operations, as defined by the Investment Program Association, or IPA, attributable to controlling interest, or MFFO, equaled approximately $12.9 million for the year ended Dec. 31, 2017, representing exponential year-over-year growth compared to MFFO of approximately $287,000 for the year ended Dec. 31, 2016. MFFO during the fourth quarter 2017 equaled approximately $4.9 million, representing approximately 457 percent growth compared to MFFO of approximately $884,000 during the same period in 2016. Funds from operations, as defined by the National Association of Real Estate Investment Trusts, or NAREIT, attributable to controlling interest, or FFO, equaled approximately $14.1 million for the year ended Dec. 31, 2017, as compared to approximately $(4.2) million for the year ended Dec. 31, 2016. FFO equaled approximately $5.2 million during the fourth quarter 2017 compared to fourth quarter 2016 FFO of approximately $(1.4) million. Year-over-year growth in MFFO and FFO is primarily due to the acquisition of additional properties. (Please see financial reconciliation tables and notes at the end of this release for more information regarding MFFO and FFO.)
- Net income for the year ended Dec. 31, 2017 was approximately $508,000, as compared to net loss of approximately $(5.5) million for the year ended Dec. 31, 2016. Net loss during the fourth quarter 2017 equaled approximately $(782,000), compared with net loss during the fourth quarter 2016 of approximately $(2.6) million. Net loss is due largely to depreciation and amortization expense of our properties, a non-cash item, in accordance with accounting principles generally accepted in the United States of America, or GAAP. (Please see financial reconciliation tables and notes at the end of this release for more information regarding net income (loss).)
- Net operating income, or NOI, totaled approximately $21.8 million for the year ended Dec. 31, 2017, representing an increase of approximately 867 percent compared to NOI of approximately $2.3 million for the year ended Dec. 31, 2016. NOI during the fourth quarter 2017 equaled approximately $8.0 million, an increase of approximately 292 percent compared to fourth quarter 2016 NOI of approximately $2.0 million. (Please see financial reconciliation tables and notes at the end of this release for more information regarding NOI.)
- As of Dec. 31, 2017, the company’s non-RIDEA2 property portfolio achieved a leased percentage of 95.2 percent and weighted average remaining lease term of 8.5 years. The company’s portfolio of senior housing — RIDEA facilities achieved a leased percentage of 76.0 percent. Portfolio leverage3 was 20.5 percent.
- The company completed fourth quarter and 2017 property acquisitions totaling $109.5 million and $327.3 million, respectively, based on aggregate contract purchase price. As of Dec. 31, 2017, the company had completed the acquisition of a portfolio comprised of 40 medical office buildings and senior housing facilities located across 14 states for an aggregate contract purchase price of approximately $466.1 million.
- The company declared and paid daily distributions equal to $0.60 per share annualized to its stockholders of record for the fourth quarter 2017, equal to an annualized distribution rate of 6.0 percent for Class T stockholders and 6.51 percent for Class I stockholders, assuming a purchase price of $10.00 per share for Class T shares and $9.21 per share for Class I shares.
- On Oct. 31, 2017, the REIT entered into an amendment with Bank of America, N.A., as administrative agent, and the subsidiary guarantors and lenders, on its existing $100 million revolving line of credit to expand the line by $50 million, to a maximum principal amount of $150 million. The REIT also obtained a term loan with its existing team of lenders for a maximum amount of $50 million. Both credit facilities mature on Aug. 25, 2019 and may be extended for one 12-month period subject to satisfaction of certain conditions as detailed in the credit agreement.
Subsequent Events
- On March 1, 2018, the company completed the acquisition of Central Wisconsin Senior Care Portfolio for $22.6 million. The portfolio’s two properties are located in the Madison suburbs of Waunakee and Sun Prairie, Wisconsin.
1 Based on aggregate contract purchase price of real estate investments as of March 1, 2018. 2 The operation of healthcare-related facilities utilizing the structure permitted by the REIT Investment Diversification and Empowerment Act of 2007 is commonly referred to as a “RIDEA” structure. 3 Total debt divided by aggregate contract purchase price of real estate investments as of Dec. 31, 2017.
