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Steve's Blog on Senior Care: by Steve Monroe, Editor of The SeniorCare Investor
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Late last year
HCP, Inc. transitioned the management of 11 of its owned properties
from
Sunrise Senior Living to
Emeritus Corporation, and then a few weeks ago announced 15 additional
properties will be transitioned away from Sunrise effective October 1,
2009. Late Monday HCP announced that it and three of its tenants have
filed complaints against Sunrise and it subsidiaries based on Sunrise’s
“defaults” under management and related agreements covering an additional
64 HCP-owned properties. Sunrise takes exception to the claims of default
and stated that these properties have steadily improved their performance,
and the company believes that this is just part of HCP’s desire to
“unlawfully” terminate these management agreements, the majority of which
do not have expirations until 2028. If HCP starts to win this legal
battle, ongoing negotiations with creditors could stall, and certainly
Sunrise’s cash flow would decline. |
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