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): January 10, 2011
CNL Lifestyle Properties, Inc.
(Exact name of registrant as specified in its charter)
| | | | |
| Maryland | | 000-51288 | | 20-0183627 |
(State or other jurisdiction of incorporation) | | (Commission File Number) | | (IRS Employer Identification no.) |
| |
450 South Orange Ave. Orlando, Florida | | 32801 |
| (Address of principal executive offices) | | (Zip code) |
Registrant’s telephone number, including area code: (407) 650-1000
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:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 2.01 | Completion of Acquisition or Disposition of Assets |
Senior Living Communities
On January 10, 2011, we acquired an ownership interest in 29 senior living facilities (the “Communities”). As previously reported on our Form 8-K filed on December 10, 2010, we entered into agreements with US Assisted Living Facilities III, Inc., an affiliate of an institutional investor (“Seller”), and Sunrise Senior Living Investments, Inc. (“Sunrise”) to acquire the Communities through a new joint venture formed by us and Sunrise (the “Sunrise Venture”), valued at approximately $630.0 million. We acquired sixty percent (60%) of the membership interests in the Sunrise Venture for an equity contribution of approximately $134.3 million, including certain transactional and closing costs. Sunrise contributed cash and its interest in the previous joint venture with Seller (the “Old Venture”) for a forty percent (40%) membership interest in the Sunrise Venture. The Sunrise Venture obtained $435.0 million in loan proceeds from new debt financing, a portion of which was used to refinance the existing indebtedness encumbering the Communities, and acquired all of Seller’s interests in the Old Venture that owned the Communities for a total purchase price of approximately $261.7 million.
The 29 Communities, which are listed below, include a total of 2,082 residential units with an average occupancy rate of approximately 87.5% as of November 30, 2010.
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Community | | Location | | Residential Units |
| | |
| Alta Loma | | Rancho Cucamonga, California | | 59 |
| Basking Ridge | | Baskin Ridge, New Jersey | | 77 |
| Belmont | | Belmont, California | | 78 |
| Chesterfield | | Chesterfield, Missouri | | 74 |
| Claremont | | Claremont, California | | 54 |
| Crystal Lake | | Crystal Lake, Illinois | | 58 |
| Dix Hills | | Dix Hills, New York | | 76 |
| East Meadow | | East Meadow, New York | | 82 |
| East Setauket | | East Setauket, New York | | 82 |
| Edgewater | | Edgewater, New Jersey | | 70 |
| Flossmoor | | Flossmoor, Illinois | | 62 |
| Gahanna | | Gahanna, Ohio | | 50 |
| Gurnee | | Gurnee, Illinois | | 59 |
| Holbrook | | Holbrook, New York | | 79 |
| Huntington Common | | Kennebunk, Maine | | 180 |
| Lincroft | | Lincroft, New Jersey | | 60 |
| Marlboro | | Marlboro, New Jersey | | 63 |
| Montgomery Village | | Montgomery Village, Maryland | | 141 |
| Naperville North | | Naperville, Illinois | | 77 |
| Plainview | | Plainview New York | | 51 |
| Roseville | | Roseville, Minnesota | | 77 |
| Schaumburg | | Schaumburg, Illinois | | 82 |
| Silver Spring | | Silver Spring, Maryland | | 65 |
| Tustin | | Santa Ana, California | | 48 |
| University Park | | Colorado Springs, Colorado | | 53 |
| West Babylon | | West Babylon, New York | | 79 |
| West Bloomfield | | West Bloomfield, Michigan | | 52 |
| West Hills | | West Hills, California | | 65 |
| Weston | | Weston, Massachusetts | | 29 |
The Sunrise Venture owns fee simple interests in the Communities, except for the Belmont, East Meadow and Lincroft Communities, which are leasehold interests. Sunrise will continue to operate and manage the Communities subject to a long-term management contract.
The Sunrise Venture obtained $435.0 million in mortgage financing from Goldman Sachs Lending Partners, LLC which is collateralized by the Communities. The non-recourse loan has a three-year term and a fixed-interest rate of 6.76% requiring monthly interest-only payments with all principal due upon maturity.
Under the terms of our venture agreement with Sunrise, we receive a preferred return on our invested capital for the first six years and share control over major decisions with Sunrise. Sunrise holds the option to buy out our interest in the venture in years three through six at a price which would provide us with a thirteen to fourteen percent internal rate of return.
| Item 9.01 | Financial Statements and Exhibits. |
| (a) | Financial Statements of Businesses Acquired. |
Financial statements for the transactions described in Item 2.01 above will be filed under cover of a Form 8-K/A as soon as practicable and no later than 71 days after the date on which this initial report on Form 8-K is filed, as applicable.
| (b) | Pro Forma Financial Information. |
Pro forma financial information for the transactions described in Item 2.01 above will be filed under cover of a Form 8-K/A as soon as practicable and no later than 71 days after the date on which this initial report on Form 8-K is filed, as applicable.
| | 99.1 | Press Release dated January 11, 2011. |
Certain statements in this report 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. These statements generally are characterized by the use of terms such as “may,” “will,” “should,” “plan,” “anticipate,” “estimate,” “predict,” “believe” and “expect” or the negative of these terms or other comparable terminology. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, actual results could differ materially from those set forth in the forward-looking statements. Given these uncertainties, the Company cautions investors and potential investors not to place undue reliance on such statements. The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect future events or circumstances or to reflect the occurrence of unanticipated events.
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 hereunto duly authorized.
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| Date: January 11, 2011 | | CNL LIFESTYLE PROPERTIES, INC. |
| | |
| | | | /s/ Joseph T. Johnson |
| | | | Name: | | Joseph T. Johnson |
| | | | Title: | | Senior Vice President and |
| | | | | | Chief Accounting Officer |
