- Current report filing (8-K)
November 18 2010 - 4:17PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
November 18, 2010 (November 12, 2010)
SENIOR HOUSING PROPERTIES TRUST
(Exact Name of Registrant as Specified in Its
Charter)
Maryland
|
|
001-15319
|
|
04-3445278
|
(State or Other Jurisdiction
of Incorporation)
|
|
(Commission File Number)
|
|
(I.R.S. Employer
Identification No.)
|
400 Centre Street, Newton,
Massachusetts 02458
(Address of Principal Executive Offices) (Zip
Code)
617-796-8350
(Registrants Telephone Number, Including Area Code)
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01
Entry into a Material Definitive Agreement.
On November 12, 2010, Senior
Housing Properties Trust, or we, our or us, entered into a series of 20
agreements, or the Purchase Agreements, for the purchase by us of 27 properties
which are majority leased as medical office, clinic and biotech laboratory
buildings, or MOBs, for purchase prices aggregating $470 million, payable in
cash. The properties to be purchased include approximately 2.8 million
square feet in the aggregate and are located in 12 states. We intend to fund the
proposed purchases with cash on hand and borrowings under our revolving credit
facility.
The properties we have agreed to
purchase have a current average occupancy (weighted by leasable area) of 95%
and are leased primarily to medical service providers and other tenants in
medical related businesses. The largest
of the properties are two office towers totaling approximately 331,000 square
feet plus garages for approximately 1,700 cars which are attached by an
enclosed walkway to Cedars-Sinai Medical Center in Los Angeles, California and
are primarily leased to medical practice groups affiliated with that hospital.
The purchases under the
individual Purchase Agreements are scheduled to be completed in a series of
separate closings expected to be completed by June 30, 2011. The purchases are subject to various closing
conditions and contingencies typical of large commercial real estate
transactions. As a result, some or all
of these purchases may be delayed or may not occur.
The descriptions of the Purchase
Agreements are qualified in their entirety by reference to the Purchase
Agreements, which are filed as Exhibits 10.1 to 10.20 to this Current Report
and incorporated herein by reference.
The 27 properties are to be
purchased from, and the other parties to the Purchase Agreements are,
CommonWealth REIT, or CWH, and certain of its subsidiaries. We were a 100% owned subsidiary of CWH until
our common shares were spun off to CWH shareholders in 1999. As a result of agreements entered into by us,
CWH and others in connection with the spin off and subsequently, we acquired a
right of first refusal to purchase from CWH and its subsidiaries certain
properties (approximately 4.6 million square feet) leased by CWH principally to
tenants in medical related businesses, in the event that CWH determined to sell
such properties or in the event of a change of control of CWH or of the
subsidiary which owns such properties, including properties that are subject to
Purchase Agreements. Excluding
properties that are the subject of the Purchase Agreements, CWH continues to
own 19 properties that remain subject to our right of first refusal.
In connection with our intended
acquisition of the 27 properties, we also entered into an amendment to our
business management agreement, or the Business Management Agreement, with Reit
Management & Research LLC, or RMR.
Under the Business Management Agreement, RMR originates and presents
investment and divestment opportunities to us and provides management and
administrative services to us. The
Business Management Agreement provides, among other things, that RMR is
entitled to a management fee at an annual rate equal to a percentage of our
average invested capital, determined as specified in the Business Management
Agreement. The percentage applied to our
existing investments at the time we were spun off from CWH is 0.5%. The annual
percentage for the first $250.0 million of investments made after our spin off
from CWH is 0.7%, and the percentage for investments above that amount is
0.5%. In addition, RMR receives an
incentive fee based upon increases in our funds from operations per share, as
defined in the Business Management Agreement.
The incentive fee is paid in our common shares.
Our average invested capital for
purposes of determining the management fees we pay to RMR is principally based
on our historical cost of our acquisitions.
The amendment to the Business Management Agreement provides that the
portion of management fees based on our average invested capital with respect
to any of the 27 properties which we acquire from CWH will be based on CWHs
historical costs of those properties rather than our purchase prices under the
applicable Purchase Agreements, so that the management fees we will pay to RMR
will generally equal the fees that are currently being paid by CWH to RMR with
respect to these properties.
The description of the amendment
to the Business Management Agreement is qualified in its entirety by reference
to the amendment, which is filed as Exhibit 10.21 to this Current Report
and incorporated herein by reference.
We and CWH are managed by
RMR. One of our Managing Trustees, Barry
M. Portnoy, is the Chairman and majority beneficial owner of RMR. Our other
Managing Trustee, Adam D. Portnoy, beneficially owns the remainder of RMR and
is a director, President and Chief Executive Officer of RMR. Messrs. Barry M. Portnoy and Adam D.
Portnoy also serve as Managing Trustees of CWH, and Frederick N. Zeytoonjian
serves as an Independent Trustee of us and of CWH. Our and CWHs executive officers are also
officers of RMR. We also own 250,000
common shares of CWH. The terms of the
purchases of the 27 properties were negotiated by special committees of each of
our and CWHs Boards of Trustees composed solely of independent trustees who
are not also trustees of the other party.
Also, the purchase prices for the properties to be acquired were
established by reference to an independent third party appraisal. The amendment to our business management
agreement with RMR described above was approved by the compensation committee
of our board of trustees, which consists solely of our Independent Trustees.
We currently own approximately
14.29% of the outstanding equity of Affiliates Insurance Company, or AIC. The other shareholders of AIC are RMR and
five other companies to which RMR provides management services, including CWH,
and all of our Trustees and the trustees and directors of the other
shareholders of AIC are also directors of AIC.
For more information about the
relationships among us, our Trustees, our executive officers, CWH, RMR, AIC and
other companies to which RMR provides management services, and risks which
arise from these relationships, please refer to our filings with the Securities
and Exchange Commission, or SEC, including our Annual Report on Form 10-K
for the fiscal year ended December 31, 2009 (including the sections
captioned Business, Risk Factors (as such section was revised and updated
in our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30,
2010) and Managements Discussion and Analysis of Financial Condition and
Results of Operations Related Person Transactions), our Proxy Statement
dated February 22, 2010 relating to our 2010 Annual Shareholders Meeting
(including the information regarding our Trustees and executive officers in
that Proxy Statement and the section captioned Related Person Transactions and
Company Review of Such Transactions), our Quarterly Report on Form 10-Q
for the fiscal quarter ended September 30, 2010 (including the section
captioned Managements Discussion and Analysis of Financial Condition and
Results of Operations Related Person Transactions), and Item 1.01 in
our Current Report on Form 8-K filed with the SEC on January 13,
2010.
WARNING CONCERNING FORWARD
LOOKING STATEMENTS
THIS
CURRENT REPORT CONTAINS STATEMENTS WHICH CONSTITUTE FORWARD LOOKING STATEMENTS
WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
AND OTHER FEDERAL SECURITIES LAWS. WHENEVER WE USE WORDS SUCH AS BELIEVE,
EXPECT, ANTICIPATE, INTEND, PLAN, ESTIMATE OR SIMILAR EXPRESSIONS, WE
ARE MAKING FORWARD LOOKING STATEMENTS. THESE FORWARD LOOKING STATEMENTS
AND THEIR IMPLICATIONS ARE BASED UPON OUR PRESENT INTENT, BELIEFS OR
EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS AND THEIR IMPLICATIONS ARE NOT
GUARANTEED TO OCCUR AND MAY NOT OCCUR.
ACTUAL
RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY OUR
FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS. FOR EXAMPLE:
·
THIS
CURRENT REPORT STATES THAT WE HAVE AGREED TO PURCHASE 27 PROPERTIES FOR $470
MILLION AND THAT THESE PURCHASES ARE EXPECTED TO BE COMPLETED IN A SERIES OF
SEPARATE CLOSINGS BY JUNE 30, 2011. THE CLOSING OF THESE PURCHASES ARE
SUBJECT TO VARIOUS CONDITIONS TYPICAL OF
LARGE, COMMERCIAL REAL ESTATE TRANSACTIONS.
AS A RESULT, SOME OR ALL OF THESE PURCHASES MAY BE DELAYED AND MAY NOT
OCCUR.
·
THIS
CURRENT REPORT STATES THAT THE TERMS OF THE PURCHASES OF THE 27 PROPERTIES WERE
NEGOTIATED BY SPECIAL COMMITTEES OF EACH OF OUR AND CWHS BOARDS OF TRUSTEES
COMPOSED SOLELY OF INDEPENDENT TRUSTEES WHO ARE NOT ALSO TRUSTEES OF THE OTHER
PARTY AND THAT THE AGREED AGGREGATE PURCHASE PRICE WAS ESTABLISHED BY REFERENCE
TO AN INDEPENDENT THIRD PARTY APPRAISAL.
AN IMPLICATION OF THESE STATEMENTS MAY BE THAT THE PURCHASE PRICES
AND OTHER TERMS OF THESE TRANSACTIONS ARE AS FAVORABLE TO US AS THOSE IN ARMS
LENGTH TRANSACTIONS. WE AND CWH ARE BOTH
MANAGED BY RMR AND HAVE COMMON TRUSTEES AND HAVE OTHER RELATIONSHIPS. ACCORDINGLY, WE AND CWH MAY BE
CONSIDERED TO BE RELATED PARTIES, AND THERE CAN BE NO ASSURANCE THAT THE
AGGREGATE PURCHASE PRICE AND OTHER TERMS OF THE TRANSACTIONS ARE AS FAVORABLE
TO US AS WE MAY HAVE OBTAINED IN ARMS LENGTH TRANSACTIONS.
OTHER
FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE IN OUR
FORWARD LOOKING STATEMENTS IN THIS CURRENT REPORT ARE DESCRIBED UNDER THE
CAPTION RISK FACTORS IN EACH OF OUR ANNUAL REPORT ON FORM 10-K FOR OUR
YEAR ENDED DECEMBER 21, 2009, AND OUR QUARTERLY REPORT ON FORM 10-Q FOR
THE QUARTER ENDED JUNE 30, 2010.
YOU
SHOULD NOT PLACE UNDUE RELIANCE UPON FORWARD LOOKING STATEMENTS.
EXCEPT
AS REQUIRED BY LAW, WE UNDERTAKE NO OBLIGATION TO UPDATE OR CHANGE ANY FORWARD
LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE.
Item 8.01. Other Events.
On November 12, 2010, we issued a press release announcing that we had
entered agreements to sell 27 properties, which agreements are further described
in Item 1.01 of this Current Report. A copy of that press release is attached
as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(d)
Exhibits
.
10.1
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the properties located at 5 Hampshire, 15
Hampshire and 100 Hampshire, Mansfield, MA).
|
|
|
|
10.2
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between
Lakewood Property Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 7600 Capital of Texas
Highway, Austin, TX).
|
|
|
|
10.3
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at One Southern Court, West
Columbia, SC).
|
|
|
|
10.4
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 6937 IH 35 North-AM
Founders, Austin, TX).
|
|
|
|
10.5
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 201
|
|
|
Executive
Center Drive, Columbia, SC).
|
|
|
|
10.6
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at One Stuart Plaza, George
Station Road, Greensburg, PA).
|
|
|
|
10.7
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at730 Holiday Drive,
Pittsburgh, PA).
|
|
|
|
10.8
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 723 Dresher Road, Horsham,
PA).
|
|
|
|
10.9
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 216 Mall Boulevard, King
of Prussia, PA).
|
|
|
|
10.10
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between HRP
NOM L.P., as Seller, and Senior Housing Properties Trust, as Purchaser (with
respect to the property located at 5260 Naiman Parkway, Solon, OH).
|
|
|
|
10.11
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the properties located at AOC-Buena Vista Building,
Buena Vista, SE, AOC-LAB Building, 1801A Randolph, SE, AOC-Randolph Building,
1801 Randolph, SE, and AOC-Sandia Vista Building, Buena Vista, SE,
Albuquerque, NM).
|
|
|
|
10.12
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the properties located at 4411 The 25 Way and 4420
The 25 Way, Albuquerque, NM).
|
|
|
|
10.13
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 3000 Goffs Falls Road,
Manchester, NH).
|
|
|
|
10.14
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at1305 Corporate Center
Drive, Eagan, MN).
|
|
|
|
10.15
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between HRP
NOM 2 L.P., as Seller, and Senior Housing Properties Trust, as Purchaser
(with respect to the property located at 59 Executive Park South, Atlanta,
GA).
|
|
|
|
10.16
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Blue
Dog Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 866 North Main Street,
Wallingford, CT).
|
|
|
|
10.17
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as Purchaser
(with respect to the property located at 40 Sebethe Drive, Cromwell, CT).
|
|
|
|
10.18
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Cedars
LA LLC, as Seller, and Senior Housing Properties Trust, as Purchaser (with
respect to the properties located at Cedars Sinai I, 8631 West Third Street,
East Tower and Cedars Sinai II, 8635 West Third Street, West Tower, Los
Angeles, CA).
|
|
|
|
10.19
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between Hub
Properties Trust, as Seller, and Senior Housing Properties Trust, as
Purchaser (with respect to the property located at 2444 West Las Palmaritas
Drive, Phoenix, AZ).
|
|
|
|
10.20
|
|
Purchase
and Sale Agreement, dated as of November 12, 2010, by and between HRPT
Medical Buildings
|
|
|
Realty
Trust, as Seller, and Senior Housing Properties Trust, as Purchaser (with
respect to the property located at 1295 Boylston Street, Boston, MA).
|
|
|
|
10.21
|
|
Amendment,
dated as of November 12, 2010, to Business Management Agreement between
Reit Management & Research LLC and Senior Housing Properties Trust.
|
|
|
|
99.1
|
|
Press
Release, dated November 12, 2010.
|
SIGNATURES
Pursuant to the requirements of
the Securities Exchange Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned thereunto duly authorized.
|
SENIOR HOUSING
PROPERTIES TRUST
|
|
|
|
|
|
|
|
/s/ Richard A. Doyle
|
|
Richard
A. Doyle
|
|
Treasurer
and Chief Financial Officer
|
|
Dated:
November 18, 2010
|
Senior Housing Properties (NASDAQ:SNH)
Historical Stock Chart
From Jun 2024 to Jul 2024
Senior Housing Properties (NASDAQ:SNH)
Historical Stock Chart
From Jul 2023 to Jul 2024