Benzinga | Aug 20, 2021 08:46AM EDT

NHI Provides Business Update Regarding Dispositions, Deferrals And Monthly Contractual Cash Collections

National Health Investors, Inc. (NYSE:NHI) today provided a business update regarding its dispositions, deferrals and monthly contractual cash collections.

Dispositions

NHI announced that it closed on the sale of eight properties consisting of 909 units formerly leased to Holiday Retirement ("Holiday") for gross proceeds of $115 million and expects to recognize a gain on the sale of approximately $1 million to $2 million. Rental income for these properties, excluding the impact of any straight-line rents, for the six months ended June 30, 2021 was $4.2 million. The Company is considering alternatives on the remaining 18 properties which could result in a range of outcomes including a lease restructuring, re-tenanting, or further asset sales.

To date, NHI has announced dispositions totaling $203.4 million which represented an approximate 8.0% yield on rental income before deferrals, excluding the impact of any straight-line rents. At June 30, 2021, the adjusted trailing three month annualized NOI yield, assuming a 5% management fee and recurring capex was approximately 3.5%.

Recent Deferral Activity

NHI agreed to defer $1 million in rent due for August 2021 from Bickford Senior Living ("Bickford"). Deferred rents related to Bickford total $12.75 million for 2021.

As previously disclosed, NHI agreed to defer approximately $0.8 million for three other tenants in August which is expected to be repaid with interest.

NHI's tenant for Holiday was recently acquired and NHI has yet to receive any payment for August from the new tenant. At the end of July, NHI continues to hold $8.8 million in Holiday security deposits.

Discussions are ongoing with other tenants with no agreements on further rent concessions yet finalized.

Collections

Adjusting for the sale of the eight properties described above, NHI has collected 81.0% of contractual cash due for August through the date of this press release. The remaining balance for the month is comprised of the following: 1.9% of contractual cash which NHI expects to collect; 3.7% in deferrals related to Bickford; 3.0% in deferrals related to three other tenants; 9.8% related to Holiday's August rent as described above; and 0.6% related to lower forecasted revenue from transitioned properties prior to the start of the pandemic.

For the third quarter-to-date of 2021 and adjusting for the sale of the eight properties described above, NHI has collected 85.6% of contractual cash due. The remaining balance for the quarter is comprised of the following: 1.0% of contractual cash which NHI expects to collect; 4.6% in deferrals related to Bickford; 1.1% in deferrals related to Holiday; 2.3% in deferrals related to three other tenants; 4.9% related to Holiday's August rent as described above; and 0.5% related to lower forecasted revenue from transitioned properties prior to the start of the pandemic. Please see the Company's Form 10-Q for the quarter ended June 30, 2021 for more information regarding rent concessions.

NHI has collected $0.03 million in previously deferred rent from one tenant during the month of August which is not reflected in the percentage of contractual cash collected.