Real estate investment trusts (REITs) are back in action in the Behavioral Health Care sector. Last April we reported on Care Capital Properties (NYSE: CCP) $380 million deal for six inpatient facilities owned by Signature Healthcare Services LLC (dba Aurora Behavioral Health). Early in August, MedEquities Realty Trust (NYSE: MRT) made its first move into the sector.
On August 7, MedEquities announced a definitive agreement to acquire four behavioral health and substance abuse treatment facilities from subsidiaries of AAC Holdings, Inc. (NYSE: AAC), aka American Addiction Centers, for $25 million.
Brentwood, Tennessee-based AAC operates 12 residential substance abuse treatment facilities, 18 standalone outpatient centers and three sober living facilities totaling more than 1,300 beds in eight states.
The acquired facilities include two standalone intensive outpatient treatment centers in Las Vegas, Nevada and Arlington (Dallas), Texas, as well as a 110-bed sober living facility in Las Vegas and a 56-bed sober living facility in Arlington. The latter is expected to expand to 131 beds by mid-2018.
The intensive outpatient and sober living facilities support two of AAC’s residential treatment centers, Desert Hope in Las Vegas and Greenhouse in Arlington.
Expect more deals to be announced by MedEquities and AAC. At the time of this acquisition, MedEquities CEO John McRoberts noted that his company has known the AAC management team for some years, and considers AAC “the right operator with whom to partner and the right facilities” to be acquired.