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HCP Announces Series of Transactions to Diversify Its Portfolio

Paul, Weiss is representing healthcare REIT HCP, Inc. in a transaction with Brookdale Senior Living Inc. to restructure HCP’s portfolio of senior housing facilities that are leased, managed and/or jointly owned by Brookdale. Under the multi-part transaction HCP will sell six properties to Brookdale for $275 million; HCP will purchase Brookdale’s 10% interest in two joint ventures for $99 million; the parties will terminate management agreements or leases for 68 properties, which HCP intends to sell or transition to other operators in 2018; and the parties are modifying the management agreements and leases for the properties that Brookdale will continue to manage or lease, as well as the terms of a remaining joint venture.

Paul, Weiss is also representing HCP in the $332 million sale of its remaining investments in the RIDEA II senior housing joint venture to an investor group led by Columbia Pacific Advisors, LLC. The RIDEA II joint venture owns 49 communities, of which 46 are managed by Brookdale.

The transactions are expected to diversify HCP’s portfolio and enhance HCP’s balance sheet. The transactions are expected to be completed throughout 2017 and 2018, subject to regulatory approvals and other customary closing conditions.

The Paul, Weiss team included real estate partners Harris Freidus and Salvatore Gogliormella and counsel Karla Booth and Andrew Wurzburger; corporate partners Robert Schumer, Ariel Deckelbaum and Michael Hong; litigation partners Audra Soloway and Moses Silverman; bankruptcy partner Jeffrey Saferstein and counsel Diane Meyers; tax partner Scott Sontag; international trade counsel Richard Elliott; antitrust counsel Marta Kelly; and employee benefits counsel Uri Horowitz and Reuven Falik.

November 2, 2017

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