Assisting Oakmont Senior Living LLC in its Sale of Senior Living Facilities to HCP, Inc.

We assisted Oakmont Senior Living LLC, a leading provider of assisted living and memory care facilities in California and Nevada, in the $399 million sale of eight senior living facilities to HCP, Inc.

The transaction was structured as a contribution to DownREITs, with Oakmont retaining management of the properties through a RIDEA structure. We restructured the ownership of the facilities to facilitate the sale, negotiated the contribution agreements and ancillary agreements, handled the legal aspects of the due diligence investigations and coordinated all closing tasks.

The project required us to contribute a portfolio of 17 multifamily housing properties to DownREITs formed by a publicly-traded REIT. The client retained long-term management of all the properties. Over half the properties were subject to loans to be assumed by the DownREITs at closing, with several different lenders involved. We restructured the client ownership in order to facilitate the DownREIT transactions.

In addition, we provided tax counsel and advice on the REIT structure and restructured the management company to comply with the RIDEA tax rules concerning management agreements. We also negotiated the contribution documents and ongoing management agreements, including incentive agreements for the manager. We oversaw the due diligence process and the production of documents to the REIT, and assisted in the loan assumptions and payoffs of any loans not assumed. We also prepared company resolutions and certificates necessary for closing and oversaw the final conveyance of the properties into the DownREIT.

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