CareTrust REIT (CTRE) acquires two properties in CA.

CareTrust REIT (CTRE) announced today that it has acquired two senior care properties located in California's Central Valley for a combined purchase price of $22.8 million.  The properties include a 70-bed skilled nursing facility in Modesto, and a Sacramento facility with 99 skilled nursing beds and 72 assisted living units.  Both facilities will be operated by Kalesta Healthcare, LLC, an existing tenant with approximately 14 years remaining on its CTRE master lease.

CTRE said that cash rent for the first two years would be $3.9 million, or an initial cap rate of approximately 8.5%, with CPI-based escalators thereafter.  CTRE also said that it expects to invest an additional $1.0 million in the Sacramento facility, with a commensurate increase to lease revenue.

CareTrust is small-cap equity REIT focused on investments in skilled nursing facilities, assisted living, and multi-service properties.  As of June 30, 2019, CTRE had a total market capitalization of approximately $2.8 billion.