Buyout firm Arcapita sells $640m US real estate portfolio

Bahrain-based Islamic investment firm Arcapita said on Wednesday it had sold its real estate portfolio of retirement communities across the United States to NorthStar Healthcare Income Trust for $640 million.

The portfolio includes 16 facilities and 4,000 residential units for continuing senior care. Net operating income from the portfolio grew by 41 per cent between 2010 and 2014, despite a slump in the U.S. housing market following the 2008 financial crisis.

“This transaction represents Arcapita’s fifth successful exit in the senior living sector, which continues to benefit from favourable long-term fundamentals,” said Atif Abdulmalik, Arcapita’s chief executive officer. “We are pleased with the profitable outcome of this investment.”

Abdulmalik said the firm has given $3 billion in exit proceeds to its investors in the last two years but did not give a breakdown of profits for its real estate portfolio exit.

In November, Arcapita completed a $100 million fundraising, a little over a year after emerging from Chapter 11 bankruptcy driven by debt repayment difficulties.