(ORLANDO, Fla.) March 26, 2020 — CNL Healthcare Properties, a real estate investment trust (REIT) focused on seniors housing, announced that its board of directors unanimously approved an estimated net asset value (NAV) per share of $7.81 as of Dec. 31, 2019. The REIT’s previous estimated NAV per share, as of Dec. 31, 2018, was updated to $7.99 following a special distribution of $2.00 per share to shareholders in May 2019.
The estimated NAV reflects the reduction in real estate assets following the company’s sale of 61 properties in calendar year 2019, and a reduction in fair market value of debt resulting from meaningfully reduced borrowing levels. Compared to the previous updated NAV, the appraised value of the company’s 71 seniors housing assets, one parcel of land and two specialty hospitals as of Dec. 31, 2019, declined by approximately 2.0%. This value adjustment is the result of capitalization rate expansion and slightly lower estimates of earnings growth, both of which negatively impacted the NAV. The NAV calculation continues to include a deduction for estimated transaction costs related to a hypothetical sale of CNL Healthcare Properties’ remaining assets as the company has publicly announced its study and pursuit of strategic alternatives to provide liquidity to shareholders.
“We are pleased to have made real and tangible progress to actively provide liquidity to shareholders over the last year. From April 2019 through March 2020, the company successfully sold a total of 68 assets through six different transactions, provided a meaningful special distribution to shareholders and strategically bolstered the health and strength of the company’s liquidity and balance sheet. It is our view that the decrease in estimated NAV per share reflects overarching market forces that persisted during much of 2019, specifically in the senior housing space,” said Stephen H. Mauldin, president and CEO of CNL Healthcare Properties. “In the face of what is now an unprecedented current health, operating and economic environment brought on by the COVID-19 pandemic, we retain great confidence in the positive long-term outlook of our portfolio that, today, principally consists of newer, well-positioned, private-pay seniors housing communities.”
The valuation was conducted by Robert A. Stanger & Co. Inc (Stanger), an independent third-party valuation firm, in accordance with the company’s valuation policy and the guidelines set forth by the Institute for Portfolio Alternatives, the leading trade organization. Stanger provided CNL Healthcare Properties with a NAV range of $7.39 to $8.26 per share. The valuation committee, comprised exclusively of independent directors, unanimously recommended $7.81 as the estimated NAV per share, and the recommendation was unanimously adopted by the board of directors.
About CNL Healthcare Properties
CNL Healthcare Properties, Inc., is a real estate investment trust (REIT) with a focus on institutional quality properties in the seniors housing sectors, including stabilized, value-add and ground-up development assets. CNL Financial Group, LLC is the sponsor of CNL Healthcare Properties. For more information, visit cnlhealthcareproperties.com.
About CNL Financial Group
CNL Financial Group (CNL) is a private investment management firm providing real estate and alternative investments. Since inception in 1973, CNL and/or its affiliates have formed or acquired companies with more than $34 billion in assets. CNL is headquartered in Orlando, Florida. For more information, visit cnl.com.
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