HCP, Inc (
HCP
)
, a real estate investment trust (REIT), reported third quarter
2012 FFO (funds from operations) of $290.2 million or 67 cents
per share compared with $259.6 million or 63 cents per share in
the year-earlier quarter.
Excluding non-recurring items, FFO for the reported quarter was
$298.1 million or 69 cents per share compared with 275.0 million
or 67 cents per share in the year-ago quarter. Recurring FFO in
the reported quarter was in line with the Zacks Consensus
Estimate.
HCP reported total revenue of $475.5 million during the quarter
compared with $441.2 million in the year-ago period. Total
revenue in the reported quarter was marginally ahead of the
Zacks Consensus Estimate of $475.0 million. Adjusted
same-property net operating income (NOI) of the company stood at
$344.2 million in the quarter versus $332.2 million in the
year-ago period.
During the reported quarter, HCP invested about $63 million to
fund development and other capital projects, primarily in the
life science, medical office and senior housing segments.
The company acquired a portfolio of 12 medical office building
MOBs (spanning 758,000 square feet) from The Boyer Company for
$186 million during the months of July to October. HCP also
completed the acquisition of eight on-campus MOBs for $81 million
from Scottsdale Healthcare and an additional MOB for $14
million. At the same time, HCP closed a $205 million
mezzanine loan facility.
Subsequent to the end of the quarter, HCP entered into an
agreement to acquire 133 senior housing communities for $1.73
billion .The properties would be acquired from a joint venture
between
Emeritus Corp (
ESC
)
and an affiliate company of
The Blackstone Group LP (
BX
).
Spread across a wide geographical area spanning 29 states, the
acquired portfolio includes a diversified mix of healthcare
facilities totaling 10,350 units. By segment the properties
comprise a mix of 61% for assisted living, 25% independent
living, 13% memory care and 1% for skilled nursing. In
accordance with the acquisition, Emeritus will purchase 9
communities from the Blackstone JV, for a secured debt financing
of $52 million.
During the quarter, the company issued $300 million of 3.15%
senior unsecured notes scheduled to mature in 2022. The
transaction generated net proceeds of approximately $293.7
million. Also the company entered into an into a credit agreement
for a four-year 1.81% unsecured loan worth $215 million.
Subsequent to the quarter-end, the company completed an equity
offering of 22 million shares and generated proceeds of $979
million.
At the end of the quarter, the company had cash and cash
equivalents of $96.5 million. For full-year 2012, HCP expects
adjusted FFO in the range of $2.75 to $2.81 per share. The
company also expects cash same-property NOI to be in the range of
4.0%-4.5%.
HCP currently retains a Zacks #3 Rank, which translates into a
short-term Hold rating. We are also maintaining our long-term
Neutral recommendation on the stock.
Note: FFO, a widely used metric to gauge the performance of
REITs, is obtained after adding depreciation and amortization and
other non-cash expenses to net income
.
BLACKSTONE GRP (BX): Free Stock Analysis
Report
EMERITUS CORP (ESC): Free Stock Analysis
Report
HCP INC (HCP): Free Stock Analysis Report
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