CareTrust REIT has finalized the acquisition of Care REIT, marking its entry into the UK healthcare real estate market. The deal adds 132 care homes and two NHS-leased facilities to its portfolio. The transaction is valued at approximately $840.5 million.

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CareTrust REIT has closed the acquisition of Care REIT. The transaction, first announced on March 11, 2025, marks CareTrust’s entrance into the UK market and represents a strategic step in the company’s mission to expand and diversify its portfolio of healthcare real estate assets.

With the completion of this transaction, CareTrust adds to its portfolio 132 care homes comprising approximately 7,500 beds and two healthcare facilities leased to the UK’s National Health Service, located throughout England, Scotland, and Northern Ireland. All properties are subject to long-term, triple-net leases across 14 operators, with a weighted average remaining lease term of approximately 20.2 years and annual inflation-based rent escalators, most with a 2% floor and 4% cap.

“We are thrilled to close on the acquisition of Care REIT, marking our first M&A deal, our first international investment, and the single largest transaction in our history,” said Dave Sedgwick, President and Chief Executive Officer of CareTrust. “Last year’s exponential growth set the table for double digit growth in 2025. This strategic acquisition is transformative for our company, significantly diversifying our portfolio by operator, geography, payor source, and asset class. The acquisition strengthens our growth profile, while adding approximately $68.6 million of annualized rental revenue and a strong EBITDARM coverage ratio of 2.2x.”

Mr. Sedgwick continued, “While we are excited about the Day 1 impact of this acquisition on our near-term outlook, we also see this transaction as an engine for growth, not just a one-off investment. With the UK’s favorable demographics, strong need-based care demand, and fragmented provider landscape, we believe there is ample opportunity to scale. At the same time, we structured our UK entrance so as not to detract from investing in our core US markets and operator relationships, which we remain deeply committed to expand simultaneously with the UK. The Care REIT acquisition brings with it an experienced UK-based team who is hungry to expand our footprint in that market with existing and new operators.”

“Our relationships with our new tenants are off to a strong and collaborative start, many of whom we got to know in the process of carefully evaluating our UK market entrance,” added James Callister, CareTrust’s Chief Investment Officer. “We’re already finding alignment in our mutual desire to expand thoughtfully and sustainably while taking advantage of current market conditions. Many of these operators are eager to grow their own portfolios and have already engaged with us in exploring additional investment opportunities in the care home space. We believe that by leveraging our competitive advantages—deep underwriting and operating experience, pristine balance sheet, access to and cost of capital, and certainty of closing—we can help our UK operators further their missions to successfully deliver strong outcomes for their patients, residents, and communities, and for our stakeholders alike.”

Mr. Callister also reiterated that the company’s replenished US investment pipeline sits at approximately $500 million of near-term, actionable opportunities—not including larger portfolios the company is reviewing—and that it is actively seeking additional growth opportunities in the US and abroad.

2025 Guidance and Liquidity

In conjunction with the closing of the Care REIT acquisition, Bill Wagner, CareTrust’s Chief Financial Officer, updated management’s 2025 guidance to include the impact of the transaction, projecting net income of approximately $1.42 to $1.45 per common share, normalized FFO of approximately $1.75 to $1.78 per common share, and normalized FAD of approximately $1.75 to $1.78 per common share. He noted that the 2025 guidance is based on diluted weighted-average common shares outstanding of 190.6 million and assumes the following:

• All investments and dispositions made to date;

• No new debt incurrences or new equity issuances; and

• Estimated 2.5% rent escalators under the company’s inflation-based triple net leases.

“We are excited by the near- and long-term growth potential the Care REIT transaction unlocks, and we believe it positions us to deliver compounding value to stakeholders over time,” said Bill Wagner, Chief Financial Officer. “After a period of integration, which we anticipate lasting through 2025, we expect to achieve annual run rate synergies of approximately $5 million. Incorporating the realization of these savings, we anticipate the fully-synergized acquisition to be approximately 9.4% accretive to normalized FFO per share and 5.7% accretive to normalized FAD per share, both relative to the guidance in place when the acquisition was announced on March 11, 2025.”

Based on the British Pound Sterling to U.S. Dollar exchange rate on May 9, 2025, the terms of the Care REIT acquisition represent a total purchase price of approximately $840.5 million, of which $595.4 million represents cash consideration to acquire Care REIT common shares, together with the assumption of $245.1 million net debt and exclusive of transaction fees. Mr. Wagner noted that the company intends to pay off the assumed debt and recapitalize the portfolio through a combination of cash on hand, a draw from its revolving credit facility, and a new $500 million unsecured term loan expected to be finalized in the second quarter, subject to ordinary closing conditions. Prior to completion of this refinancing, net debt-to-normalized EBITDA is expected to be below 2.0x.

Piper Sandler Ltd and JP Morgan Securities LLC acted as financial advisors and Jones Day acted as legal advisor to CareTrust.

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