In order to repay its existing debts,
LTC Properties, Inc.
(
LTC
), a real estate investment trust (REIT), recently announced its
entering into a private placement of $85.8 million worth senior
secured notes with a group of institutional investors. The private
placement, which is scheduled to mature on 2024, bears an interest
of 5.03%.
This apart, the notes bear a principal repayment of about $17.2
million in years 8 through 12. The company is expected to use the
net proceeds to decrease borrowings under its unsecured revolving
credit facilities and for general corporate purposes and
acquisitions.
Westlake Village, California-based LTC Properties primarily invests
in long-term care and other healthcare-related properties through
mortgage loans, property lease transactions and other investments.
The company usually leases its healthcare facilities under "triple
net" leases where the tenant pays all taxes, insurance, and
maintenance for the properties, in addition to rent.
The "triple net" lease agreements insulates the company from
short-term market swings that may adversely affect the operations
of a particular facility, and provides a relatively steady source
of income. Recently, LTC properties acquired a skilled nursing
property with 90 licensed beds located in Brownwood, Texas for $6.5
million. The company utilized the proceeds from its unsecured
revolving line of credit to fund the acquisition.
At March 31, 2012, LTC Properties' portfolio consisted of 89
skilled nursing properties, 102 assisted living properties, 14
other senior housing properties, two schools and a parcel of land
under development.
LTC Properties will likely release its second quarter 2012 earnings
on August 8. The Zacks Consensus Estimate for second quarter 2012
FFO (fund from operations) is pegged at 57 cents per share. We
presently have a long-term Neutral recommendation on the stock.
Also, it retains a Zacks #3 Rank (short-term Hold rating). One of
its competitors -
HCP, Inc.
(
HCP
) - holds a Zacks #2 Rank, which translates into a short-term Buy
rating.
HCP INC (HCP): Free Stock Analysis Report
LTC PROPERTIES (LTC): Free Stock Analysis
Report
To read this article on Zacks.com click here.