Physicians Realty Trust (NYSE:DOC), (the “Company,” the “Trust,” “we,” “our” and “us”), a self-managed healthcare real estate investment trust, is providing this update related to its three Long-Term Acute Care Hospital (“LTACH”) assets previously operated by LifeCare Holdings, LLC (“LifeCare”). As discussed in the Company’s May 30, 2019 press release, LifeCare, along with several related entities, filed for Chapter 11 bankruptcy on May 6, 2019 in order to facilitate a sale process under bankruptcy protection.
On September 30, 2019, LifeCare 2.0, LLC (“LC 2.0”), a newly formed affiliate of LeBlanc Healthcare founded by David LeBlanc, closed its purchase of certain assets from LifeCare used in connection with LifeCare’s operation of certain long-term acute care and behavioral health facilities in Pennsylvania and Texas, including the three facilities owned by the Company in Pittsburgh, Pennsylvania; Fort Worth, Texas; and Plano, Texas. David LeBlanc founded the original LifeCare company in 1992 which he expanded from 22 beds to 900+ beds before selling it to The Carlyle Group in 2005.
The bankruptcy court approved the sale of the LifeCare assets to LC 2.0 on October 2, 2019. As part of its purchase, LC 2.0 assumed the Company’s single master lease for all three facilities without change and has made the current October rent payment. Additionally, LC 2.0 has agreed to pay, in monthly installments over the next 12 months, approximately $1.0 million representing all past due rent, real estate taxes, late charges, and interest under the lease, as well as $125,000 for attorneys’ fees incurred by the Company related to LifeCare’s bankruptcy.
John T. Thomas, the Company’s President and Chief Executive Officer of the Trust commented, “We are pleased that LifeCare 2.0 recognized the profitability of these assets and agreed to honor our leases on the current terms. The bankruptcy process has enhanced the value of these assets by bringing in an experienced operator with a strong track record and a better credit profile than our previous tenant. We look forward to discussing the transition on our upcoming earnings call scheduled for November 6, 2019.”
About Physicians Realty Trust
Physicians Realty Trust is a self-managed healthcare real estate company organized to acquire, selectively develop, own and manage healthcare properties that are leased to physicians, hospitals and healthcare delivery systems. The Company invests in real estate that is integral to providing high quality healthcare. The Company conducts its business through an UPREIT structure in which its properties are owned by Physicians Realty L.P., a Delaware limited partnership (the “operating partnership”), directly or through limited partnerships, limited liability companies or other subsidiaries. The Company is the sole general partner of the operating partnership and, as of June 30, 2019, owned approximately 97.1% of OP units.
Investors are encouraged to visit the Investor Relations portion of the Company’s website (www.docreit.com) for additional information, including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, press releases, supplemental information packages and investor presentations.
This press release contains statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “anticipate”, “believe”, “expect”, “estimate”, “plan”, “outlook”, “continue”, “intend”, and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements may include statements regarding the Company’s strategic and operational plans, the Company’s ability to generate internal and external growth, the future outlook, anticipated cash returns, cap rates or yields on properties, anticipated closing of property acquisitions, and ability to execute its business plan. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. Forward looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. These forward-looking statements are subject to various risks and uncertainties, not all of which are known to the Company and many of which are beyond the Company’s control, which could cause actual results to differ materially from such statements. These risks and uncertainties are described in greater detail in the Company’s filings with the Securities and Exchange Commission (the “Commission”), including, without limitation, the Company’s annual and periodic reports and other documents filed with the Commission. Unless legally required, the Company disclaims any obligation to update any forward-looking statements after the date of this release, whether as a result of new information, future events or otherwise. For a description of factors that may cause the Company’s actual results or performance to differ from its forward-looking statements, please review the information under the heading “Risk Factors” included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 filed by the Company with the Commission on February 28, 2019.
Source: Physicians Realty Trust