Business Context and Reporting Period
This Form 8-K Current Report was filed by Griffin-American Healthcare REIT IV, Inc. on March 1, 2018. The registrant is an emerging growth company incorporated in Maryland. The filing discloses a material acquisition event occurring on the report date.
Key Financial Metrics and Transaction Details
- Acquisition Price: $22,600,000 contract purchase price, plus closing costs.
- Financing: Funded via cash proceeds from the initial public offering and borrowings under a revolving line of credit with Bank of America, N.A. and KeyBank, National Association.
- Advisor Fees: A base acquisition fee of approximately $509,000 (2.25% of purchase price) was paid. An additional contingent advisor payment of approximately $509,000 (2.25%) has been accrued, subject to conditions.
- Asset Details: The Central Wisconsin Senior Care Portfolio includes two facilities in Sun Prairie and Waunakee, Wisconsin, totaling 254 beds and approximately 236,000 square feet of gross leasable area.
- Occupancy: The portfolio is currently 100% occupied.
Material Changes
The primary material change is the expansion of the company's asset base through the acquisition of the Central Wisconsin Senior Care Portfolio from unaffiliated third parties (Waunakee Manor, a Limited Partnership and Sun Prairie Associates Limited Partnership). This transaction increases the company's footprint in the skilled nursing, assisted living, and independent living sectors.
Outlook, Risks, and Management Commentary
Management highlighted the immediate 100% occupancy of the acquired assets, suggesting stable cash flow potential from day one. The transaction was publicly announced via a press release issued by co-sponsor American Healthcare Investors, LLC on March 7, 2018. No specific forward-looking guidance or new risk factors were disclosed in this specific filing beyond the standard contingencies related to the advisor fee payment.
Investor Verification Checklist
- Verify the exact closing costs added to the $22.6 million purchase price.
- Confirm the specific terms and interest rates of the borrowings under the revolving line of credit used for financing.
- Review the conditions required to trigger the contingent advisor payment of $509,000.
- Assess the impact of the acquisition on the company's leverage ratios and liquidity position.