Sabra Health Care REIT Inc. (SBRA), a real estate investment trust (REIT), recently acquired a 48-unit memory care facility in Aurora in the Denver Metropolitan area in Colorado. The facility was acquired from an affiliate of New Dawn Holding Company for $16.0 million. The transaction was funded with available cash.

In addition to the deal, Sabra Health Care also entered into a triple-net lease agreement with the affiliates of New Dawn, under which the tenant will pay all taxes, insurance, and maintenance for the property, in addition to rent. The 10-year lease includes a fixed annual rent escalation of 3.0% and two five-year renewal options. Sabra Health Care was also granted a right of first refusal for the acquisition of a new memory care facility being built in Sun City West, Arizona.

The strategic move is aimed to extend its presence in the senior housing memory care segment. The acquired facility provides high quality services and targets a population which has a demand for newly developed technologies. The company's strategy of diversifying its portfolio is backed by a dedicated management team. During the six months ended June 30, 2012, the company acquired six skilled nursing facilities for $55.6 million.

Sabra Health Care currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We also have a long-term Neutral recommendation on the stock. One of its competitors, Health Care REIT, Inc. (HCN) also holds a Zacks #3 Rank.

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Sabra Health Care Acquires Asset - Analyst Blog