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Brookdale Senior Living Sells Remaining 20% Stake in HCA Venture

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Brookdale Senior Living has sold its remaining 20% equity interest in its home health and hospice joint-venture with HCA Healthcare (NYSE: HCA) for $27 million. 

Brookdale, the nation’s largest operator with 672 communities in 42 states, did not immediately name a buyer or respond to a request for more information Wednesday.

The sale comes months after Brookdale CEO Cindy Baier said the company would continue to “lean in” to its health care programs, including HealthPlus.

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“We can once again report margin expansion in 2024 as we improve leverage of fixed costs, and naturally become more productive while meeting our residents’ needs providing high quality care and services,” Baier said during the company’s earnings call in November. “Looking ahead, it remains undeniable that demand from the target senior demographic is here and rising.”

The Brentwood, Tennessee-based senior living operator formed the joint venture in 2021 after selling an 80% stake in its health care services segment to Nashville-based health care provider HCA in a $400 million transaction.

The JV later that year sold off a number of assets to LHC Group, which itself was acquired by UnitedHealth Group (NYSE: UNH) subsidiary Optum Health in 2022.

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In tandem with the sale of its HCA stake, Brookdale refinanced its remaining 2024 debt maturities, pushing its next debt maturities out to 2025.

“We believe the positive strides we have made in 2023 are reflected in these completed financing transactions, which clear our debt maturities until 2025,” said Dawn Kussow, Brookdale’s executive vice president and CFO, in a statement. “The ongoing proactive management of our liquidity position, including these completed and pending transactions, together with Brookdale’s solid improvement in operating results, support our continued strong liquidity position.”

Also in the month of December, Brookdale got a $180 million loan with Jones Lang LaSalle Multifamily, which was obtained pursuant to Fannie Mae’s DUS Program. Brookdale secured the debt through non-recourse first mortgages on 47 communities, “which also continue to secure approximately $580 million of additional outstanding mortgages with a later maturity,” the operator said.

At the time of the loan’s closing, Brookdale used proceeds from the loan and cash on hand to repay $260 million of debt scheduled to mature in 2024.

Brookdale also amended its revolving credit agreement with Capital One to “provide an expanded commitment of up to $100 million which can be drawn in cash or as letters of credit and represents a $20 million increase from the previously existing commitment.”

Brookdale’s amended credit facility matures in early 2027, with options to extend the facility to March 2028 and March 2029.

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