Healthpeak Properties, Inc 8-K, filed Jun 9, 2020
Healthpeak Properties, Inc. (DOC)
About this 8-K
Healthpeak Properties, Inc filed this 8-K on June 9, 2020.
Items reported
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
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Item 8.01 Other Events.
Tender Offer
On June 9, 2020, Healthpeak Properties, Inc. (the “Company”) announced that it has commenced a tender offer to purchase for cash up to $150,000,000 aggregate principal amount of the Company’s 4.250% Senior Notes due 2023. The tender offer is being made exclusively pursuant to an offer to purchase dated June 9, 2020, which sets forth the terms and conditions of the tender offer.
A copy of the press release announcing the tender offer is attached hereto as Exhibit 99.1 and is incorporated in this Item 8.01 by reference.
COVID-19 Update
The Company is providing certain preliminary updates on the impact of COVID-19 on its three healthcare asset classes of life sciences, medical office and senior housing through May 2020. The information is attached as Exhibit 99.2 hereto and incorporated in this Item 8.01 by reference. This information remains unchanged from the Company’s Investor Presentation used in connection with NAREIT’s REITweek 2020 Virtual Investor Conference, which was furnished under Item 7.01 of the Current Report on Form 8-K with the SEC on June 3, 2020.
Statements in this Current Report on Form 8-K (including the Exhibits hereto) that are not historical facts 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. Forward-looking statements include, among other things, statements regarding the Company’s and its officers’ intent, belief or expectation with respect to the preliminary May 2020 updates and as otherwise identified by its use of terms and phrases such as “may,” “will,” “project,” “expect,” “believe,” “intend,” “anticipate,” “seek,” “target,” “forecast,” “plan,” “potential,” “estimate,” “could,” “would,” “should” and other comparable and derivative terms and phrases or the negatives thereof, including references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include those risks and uncertainties associated with the Company’s business described in its Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, and its subsequent filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company can give no assurance that the expectations will be attained or that any deviation will not be material. Except as required by law, the Company does not undertake, and hereby disclaims, any obligation to update any forward-looking statement which speak only as of the date on which they are made.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The following exhibit is being filed herewith:
| No. | Description | |
| 99.1 | Press Release dated June 9, 2020 | |
| 99.2 | Certain Company information | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: June 9, 2020
| Healthpeak Properties, Inc. | |||
| By: |
/s/ Peter A. Scott | ||
| Name: | Peter A. Scott | ||
| Title: | Executive Vice President and Chief Financial Officer | ||
Exhibit 99.1
Healthpeak Properties™ Announces Tender Offer for Outstanding Notes
IRVINE, Calif., June 9, 2020 /PRNewswire/ -- Healthpeak Properties, Inc. (NYSE: PEAK) announced today that it has commenced a tender offer (the “Tender Offer”) to purchase for cash up to an aggregate principal amount of $150,000,000 (the “Aggregate Maximum Tender Amount”) of its 4.250% Senior Notes due 2023 (the “Notes”).
| Title of Note | CUSIP Number | Principal Amount Outstanding |
Aggregate Maximum Tender Amount |
U.S. Treasury Reference Security |
Bloomberg Reference Page |
Fixed Spread |
Early Tender Premium (1)(2) |
| 4.250% Senior Notes due 2023 |
40414LAJ8 | $550,000,000 | $150,000,000 | 0.125% UST due 5/15/2023 |
FIT1 | +95 bps | $30 |
| (1) | Per $1,000 principal amount. |
| (2) | The Total Consideration for Notes validly tendered prior to or at the Early Tender Time (as defined below) and accepted for purchase is calculated using the Fixed Spread (as defined below) and is inclusive of the Early Tender Premium. |
The Tender Offer consists of an offer to purchase the Notes for cash, on the terms and conditions set forth in the offer to purchase, dated June 9, 2020 (as the same may be amended or supplemented, the “Offer to Purchase”). Subject to the Aggregate Maximum Tender Amount, proration (if applicable) and the satisfaction or waiver of the conditions to the Tender Offer, including a financing condition, Healthpeak Properties, Inc. (“Healthpeak”) will accept for purchase on the Early Settlement Date, if any, or the Final Settlement Date (each as defined in the Offer to Purchase), as applicable, Notes validly tendered in the Tender Offer.
Notes validly tendered at or prior to the Early Tender Time will be accepted for purchase in priority to other Notes validly tendered after the Early Tender Time. Accordingly, if the Aggregate Maximum Tender Amount is reached in respect of tenders of Notes made at or prior to the Early Tender Time, no Notes that are tendered after the Early Tender Time will be accepted for purchase unless the Aggregate Maximum Tender Amount is increased by Healthpeak, in its sole discretion, subject to proration.
The Tender Offer will expire at 12:00 midnight, New York City Time, at the end of July 7, 2020, or any other date and time to which Healthpeak extends the Tender Offer (such time and date, as it may be extended, the “Expiration Time”), unless the Tender Offer is earlier terminated. Holders of the Notes must validly tender and not validly withdraw the Notes prior to or at 5:00 pm, New York City Time, on June 22, 2020 (such date and time, as it may be extended, the “Early Tender Time”), to be eligible to receive the Total Consideration, which is inclusive of an amount in cash equal to the amount set forth in the table above under the heading “Early Tender Premium” (the “Early Tender Premium”), plus Accrued Interest (as defined below). Holders of the Notes who validly tender their Notes after the Early Tender Time but prior to or at the Expiration Time will be eligible to receive an amount equal to the Total Consideration minus the Early Tender Premium plus Accrued Interest.
Subject to applicable law, Healthpeak may increase or decrease the Aggregate Maximum Tender Amount in its sole discretion. Subject to applicable law, Healthpeak may increase or decrease the Aggregate Maximum Tender Amount without extending the Withdrawal Deadline (as defined below).
The Notes may be validly withdrawn at any time prior to, but not after, 5:00 pm, New York City Time, on June 22, 2020, (such date and time, as it may be extended, the “Withdrawal Deadline”). Subject to applicable law, Healthpeak may increase or decrease the Aggregate Maximum Tender Amount without extending the Withdrawal Deadline.
The “Total Consideration” for each $1,000 principal amount of Notes validly tendered and accepted for purchase pursuant to the Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the fixed spread for the Notes specified in the table above plus the yield based on the bid-side price of the U.S. Treasury Reference Security specified in the table above at 10:00 a.m., New York City Time, on June 23, 2020, unless extended or the Tender Offer is earlier terminated.
Except as set forth below, payment for the Notes that are validly tendered prior to or at the Expiration Time will, if not previously paid for on an earlier settlement date, if applicable, be made on a date promptly following the Expiration Time, which is currently anticipated to be July 9, 2020, the second business day after the Expiration Time. Healthpeak reserves the right, in its sole discretion, to make payment for Notes that are validly tendered prior to or at the Early Tender Time on an earlier settlement date, which, if Healthpeak so elects, is currently anticipated to be June 24, 2020, provided that the conditions to the Tender Offer have been satisfied or waived.
Holders of the Notes will also receive accrued and unpaid interest on their Notes validly tendered and accepted for purchase from the last interest payment date up to, but not including, the applicable settlement date (“Accrued Interest”).
The Tender Offer is subject to the satisfaction or waiver of certain conditions, including a financing condition, as more fully set forth in the Offer to Purchase. The Tender Offer is not subject to minimum tender conditions.
Information Relating to the Tender Offer
The Offer for Purchase is being distributed to holders beginning today. Wells Fargo Securities and Barclays are serving as the dealer managers for the Tender Offer. Investors with questions regarding the Tender Offer may contact Wells Fargo Securities at (704) 410-4759 (collect) or (866) 309-6316 (toll-free) or Barclays at (212) 528-7581 (collect) or (800) 438-3242 (toll-free).
None of Healthpeak or its affiliates, their respective boards of directors, the dealer managers, the tender and information agent or the trustee with respect to the Notes is making any recommendation as to whether holders should tender any Notes in response to the Tender Offer, and neither Healthpeak nor any such other person has authorized any person to make any such recommendation. Holders must make their own decision as to whether to tender any of their Notes, and, if so, the principal amount of Notes to tender.
This press release is for informational purposes only and is not an offer to buy, or the solicitation of an offer to sell, any of the Notes and the Tender Offer does not constitute an offer to buy or the solicitation of an offer to sell the Notes in any jurisdiction or in any circumstances in which such offer or solicitation are unlawful. The full details of the Tender Offer, including complete instructions on how to tender the Notes, are included in the Offer to Purchase. Holders are strongly encouraged to carefully read the Offer to Purchase, including materials incorporated by reference therein, because they will contain important information. The Offer to Purchase may be downloaded from Global Bondholder Services Corporation’s website at www.gbsc-usa.com/healthpeak/ or obtained from Global Bondholder Services Corporation, free of charge, by calling toll-free at (866) 470-4500 (bankers and brokers can call collect at (212) 430-3774).
About Healthpeak
Healthpeak Properties, Inc. is a fully integrated real estate investment trust (REIT) and S&P 500 company. Healthpeak owns and develops high-quality real estate in the three private-pay healthcare asset classes of Life Science, Senior Housing and Medical Office, designed to provide stability through the inevitable industry cycles. At Healthpeak, we pair our deep understanding of the healthcare real estate market with a strong vision for long-term growth.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by their use of terms and phrases such as “believe,” “expect,” “intend,” “project,” “anticipate,” “position,” and other similar terms and phrases, including references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks and uncertainties include, but are not limited to, Healthpeak’s ability to complete the Tender Offer and reduce its outstanding debt within expected time-frames or at all, and other risks and uncertainties described in the Offer to Purchase and in its Securities and Exchange Commission filings. Although Healthpeak believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, Healthpeak can give no assurance that the expectations will be attained or that any deviation will not be material. All information in this release is as of the date of this release, and Healthpeak undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in its expectations, except as required by law.
Contact
Barbat Rodgers
Senior Director – Investor Relations
(949) 407-0400
Exhibit 99.2
May 2020 Preliminary Updates (Life Science, Medical Office and Hospitals) 1 Indicator As of, or for the month ended, May 31, 2020, unless otherwise noted Commentary Life Science Occupancy • 95.6% • Up 90 bps since April 30 (1) May Leasing • 91K SF of executed leases (includes 17K SF of new leasing) • Year - to - date ahead of original expectations Letters of Intent • 291K SF of executed LOIs in lease documentation (includes 266K SF of new leasing) • 60% of new leasing commitments driven by existing tenants looking to expand May Rent Payments • 97% received • May collections in - line with April collections as of month end Rent Relief Requests • In discussion with a few tenants on short - term deferrals in special circumstances • No material new requests in May Medical Office Occupancy • 91.4% • Up 10 bps since April 30 May Leasing • 195K SF of executed leases (includes 50K SF of new leasing) • Year - to - date ahead of original expectations Letters of Intent • 625K SF of executed LOIs in lease documentation (includes 140K SF of new leasing) • Slightly lower than average LOIs in documentation phase May Rent Payments • 96% of contractual rents received or deferred (90% received plus 6% deferred) • Deferral program represents previously announced program done in conjunction with HCA • May collections in - line with April collections as of month end after accounting for deferrals Rent Relief Requests • $2.6M of rent deferrals (259 tenants) • Approved 428 tenants for rent deferrals (~$4.7M of monthly rent) o 239 tenants elected to pay all or a portion of May rent (~$2.1M of monthly rent) Hospitals May Rent Payments • 96% received • Reached agreement with one of our hospital tenants to apply security deposit to outstanding rent which covers April, May and part of June • Tenant will pay the remaining balance due for June, stay current going forward, and replenish the security deposit by year end May 2020 data based on preliminary information and is subject to change. (SF = square feet) (1) MOM occupancy variance consists of 20 bps increase due to a property going into redevelopment, 40 bps increase due to reclass ifi cation of 38K SF at The Post, and the balance resulting from new leasing.
May 2020 Preliminary Updates (Senior Housing) (1) Properties that are held for sale, in redevelopment or in development are excluded from reporting statistics. (2) Move - in and move - out data excludes skilled nursing beds given the Medicare residents usually have lengths of stay of 30 days or less. (3) Skilled nursing units in our CCRC and SHOP portfolios received $14.6M (SHOP $2.1M and CCRCs $12.5M) of Coronavirus Aid, Relie f, and Economic Security ("CARES") Act funding in April and May. This represents pro rata funding provided to all Medicare providers, and, in the most recent tranche, $50k per property plus $2,500 per bed. 2 Indicator As of, or for the month ended, May 31, 2020, unless otherwise noted Commentary Senior Housing: SHOP (1)(2)(3) Total Occupancy • Spot occupancy declined 190 bps May 31, 2020 vs April 30, 2020 Move - ins • Declined 65% vs. May 2019; Increased 53% vs. Apr 2020 • 78% of our properties are now accepting move - ins, versus 45% as of late April Move - outs • Declined 12% vs. May 2019; Declined 29% vs. Apr 2020 • Driven by lower voluntary move - outs in the May 2019 comparison period Leads • Declined 37% vs. May 2019; Increased 26% vs. Apr 2020 • Operators are prioritizing digital marketing platforms Tours • Declined 46% vs. May 2019; Increased 19% vs. Apr 2020 • Tours in May 2020 were entirely virtual / digital Senior Housing: CCRC (1)(2)(3) IL/AL/MC Occupancy SNF Occupancy Total Occupancy • Spot occupancy declined 110 bps in IL/AL/MC May 31, 2020 vs April 30, 2020 • Spot occupancy increased 110 bps in skilled nursing May 31, 2020 vs April 30, 2020 • Total spot occupancy declined 70 bps May 31, 2020 vs April 30, 2020 IL/AL/MC Move - ins • Declined 86% vs. May 2019; Increased 30% vs. Apr 2020 • 67% of our IL/AL/MC properties in are now accepting move - ins, versus 60% as of late April IL/AL/MC Move - outs • Declined 25% vs. May 2019; Increased 4% vs. Apr 2020 • Driven by lower voluntary move - outs in the May 2019 comparison period IL/AL/MC Leads • Declined 45% vs. May 2019; Increased 21% vs. Apr 2020 • Operators are prioritizing digital marketing platforms IL/AL/MC Tours • Declined 49% vs. May 2019; Declined 7% vs. Apr 2020 • Tours in May 2020 were entirely virtual / digital Senior Housing (SHOP and CCRC) Expense Update April Expense Results (May expense results not yet available) Total expenses increased 5% • Labor increased 6% • Supplies increased 135% • April results came in at the low end of PEAK’s 5 - 15% expense outlook • We expect Supply increases to be within the range set forth in our earnings framework (30 - 90%) over a multi - month period due to stockpiling and high COVID - 19 activity in April • Total COVID - 19 expenses in April were $7.9M (SHOP $5.5M and CCRCs $2.4M); $240k related to testing which we anticipate to increase over the coming months Senior Housing: NNN Tenant Updates May Rent Payments • 97% received + 3% deferred Capital Senior Living • Agreed to defer 25% of rent (~$1.7M) from April 2020 to maturity in October 2020. The deferred rent must be repaid within 3 y ear s of lease expiration (10/31/20) and, if not repaid within one year of lease expiration, will bear interest at L+300. Harbor Retirement Associates (HRA) • Withdrew rent relief request Senior Housing: Known COVID - 19 Positive Cases Based on the reports Healthpeak receives from its operators across 222 properties, as of May 31, 2020, Healthpeak had 72 properties managed by 14 different operators with confirmed resident COVID - 19 cases, and 42 of those affected properties had experienced resident deaths. • New COVID - 19 resident positive cases have declined from a peak of 162 per week in mid - late April to 40 per week in late May • 41 of our 72 COVID - 19 resident positive properties are 14 or more days from the most recent exposure May 2020 data based on preliminary information and is subject to change. Spot Occupancy (May 31) Average Daily Census (May) 79.5% 79.8% Spot Occupancy (May 31) Average Daily Census (May) 83.8% 84.1% 59.0% 79.6% 56.9% 79.6%