CNL Healthcare Properties REIT Valuation Reveals 5.7% Increase in NAV
The board of directors of CNL Healthcare Properties Inc. – a non-traded real estate investment trust focused on senior housing – has approved a net asset value of $6.64 per share of its common stock as of Dec. 31, 2024. The valuation was completed by independent third-party evaluation firm Robert A. Stanger & Company Inc., and the board accepted Stanger’s recommendation on March 5, 2025.
This latest NAV represents an increase of approximately 5.7% from the REIT’s $6.28 estimated NAV per share as of December 2023. The company said the change is due to an increase in the value of its appraised properties driven by improved property performance within its RIDEA portfolio in conjunction with an increase in value at its 15 triple-net leased properties which benefited from improved lease coverage metrics.
According to CNL Healthcare, the senior housing industry alongside the general market “has faced inflationary pressures and rising interest rates, which have had a resulting impact on margins, discount rates and cap rates, and partially offset the value increase from improved performance.”
Despite the increase, the NAV per share is still short of the Dec. 31, 2022, estimate of $6.92. Since September 2013, the NAV price has ranged from $6.28 at its lowest and $10.32 at its highest, valued on Dec. 31, 2017.
Last month, AltsWire reported that the REIT had recommended that stockholders reject an unsolicited, non-binding tender offer from West 4 Capital LP, a Cayman Islands exempted limited partnership and unaffiliated third party.
West 4 Capital has offered to buy up to 8.8 million, or approximately 5%, of the issued and outstanding shares of common stock at a price of $3.29 per share, without interest.
CNL Healthcare’s board had stated its belief that the West 4 offer was seeking to capitalize on the REIT’s lack of liquidity and make a profit by purchasing shares at a price significantly below their fair value. According to CNL Healthcare, West 4’s price of $3.29 was 47.6% less than CNL’s $6.28 estimated NAV per share as of Dec. 31, 2023. As previously reported by AltsWire, this was a 9.25% decline from the previous year.
CNL Healthcare also reported that West 4’s offer expressly reserves the right to amend the terms of the tender offer, including decreasing the $3.29 offer price, among other terms.
The company also reminded shareholders that its board of directors has been actively exploring strategic alternatives since 2018, including a possible sale of the company. CNL Healthcare also stated that it believes that its current portfolio of 70 properties, including 69 senior housing communities and one vacant land parcel adjacent to one of its senior housing communities, is well-positioned to generate long-term value for the company’s stockholders.
From 2019 to 2022, the REIT paid a regular quarterly cash distribution of $0.0512 per share. In 2022, the distribution was adjusted to $0.0256, which has continued to be paid through the fourth quarter of 2024.
CNL Healthcare received a similar tender offer from Comrit Investments 1 LP, a Tel Aviv-based investment fund, in January 2024.
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