CareTrust REIT Agrees To Buy 45 UK Care Homes From LNT For £1.1 Billion, Pushing Year-To-Date Investments To A Record $2.7 Billion

CareTrust REIT agreed to acquire 45 UK care homes from developer LNT Care Developments for approximately £1.1 billion, the company disclosed Friday in an 8-K filing, a transaction CEO Dave Sedgwick said pushed year-to-date investments to a record $2.7 billion. The deal is structured with staggered closings and gives CareTrust a defined path into a senior housing operating portfolio across the United Kingdom.

What The Filing Says

The first closing, covering 23 completed homes and one additional home still awaiting regulatory approval expected in October, occurred Thursday for approximately £576 million — about $764 million — funded through settlements of outstanding forward equity agreements and a draw on CareTrust's revolving credit facility.

The remaining 21 homes are currently under development. CareTrust will acquire those for approximately £504 million upon completion and receipt of regulatory approvals, anticipated on a rolling basis through the end of 2027. Each of the 45 homes carries a purchase price of £24 million.

During the initial lease-up period, all 45 homes will be triple-net leased to subsidiaries of Crystal Care, LNT's care home operating company, under leases with fixed annual escalators and renewal options. LNT guarantees Crystal Care's payment obligations. Chief Investment Officer James Callister described the arrangement plainly in the press release: "We have structured it so that we are paid to be patient while the homes fill."

The Path To Operating Income

Once homes stabilize, CareTrust and LNT intend to convert them to a RIDEA structure — the arrangement that allows a real estate investment trust to share directly in operating income rather than collecting only rent. The press release calls this the SHOP Phase, for senior housing operating portfolio, and expects it to begin between two and four years after each home's completion, with the first such conversion anticipated by the fourth quarter of 2027.

The transaction is expected to generate an all-in yield in the mid- to high-7% range on a pre-tax basis in year one of the SHOP Phase, according to the press release. The deal also grants CareTrust an option, exercisable through September 2027, to acquire the entire LNT platform outright.

Separate from the LNT transaction, CareTrust said it closed approximately $488 million of other investments since its second-quarter earnings report at a blended, stabilized yield of 8.8%.

Guidance And What To Watch

CareTrust raised its full-year 2026 guidance alongside the announcement, now projecting normalized funds from operations — a standard measure of REIT earnings that strips out depreciation and certain other items — of approximately $2.06 to $2.09 per share.

The key milestones ahead are regulatory approvals for the 21 homes still under development, expected on a rolling basis through December 31, 2027, and the first conversion of completed homes to the senior housing operating structure, anticipated by the fourth quarter of 2027. The 8-K flags that development timelines, regulatory approvals, and the performance of homes during lease-up are all risk factors that could cause actual results to differ from management's expectations.

The next concrete dates to track: regulatory sign-off on the one home from the first closing still pending approval, expected in October, and the rolling acquisition of the 21 development-stage homes through the end of 2027.

Sources

• 8-K Filing — CareTrust REIT, Inc. (CTRE) — SEC EDGAR
• Exhibit ex991pr-lnt.htm — CareTrust REIT, Inc. 8-K exhibit — SEC EDGAR
• CareTrust Announces Strategic SHOP Pipeline Agreement with LNT Care Developments to Acquire 45 New UK Care Homes for £1.1 Billion – Company Announcement - FT.com — markets.ft.com