Irvine, CA-based Sabra Health Care REIT has converted 21 Holiday Retirement communities in its portfolio from a triple-net master lease to a management agreement structure, the real estate investment trust announced Tuesday.

The master lease was terminated, and the real estate investment trust entered into management agreements with Holiday, which will begin managing the communities for a monthly base fee equal to 5% of revenue. Incentives will be added after the first year if predetermined performance thresholds are met, Sabra said. The management agreements have a one-year term with one-year extensions at the REIT’s option.

“In exchange for terminating the master lease, we received $57.2 million of total cash consideration, which we expect to use to repay borrowings under our revolving credit facility,” Sabra said.

Senior Care Centers

In other news, the REIT said that it finalized the previously announced $282.5 million sale of 28 facilities formerly operated by Senior Care Centers on April 1.

Sabra said it expects to leases seven of the remaining 10 Senior Care Centers facilities in its portfolio expected to an operator already represented in its portfolio. The 12-year triple-net master lease should be effective on or about May 15, the REIT said.

Sabra also said it expects to sell the three remaining Senior Care Centers facilities in the portfolio, two of which currently are not in operation, in the coming months.

“We are very pleased to turn the page on the final chapter of our Senior Care Centers relationship,” Sabra CEO and Chairman Rick Matros said.

The concentration of skilled nursing facilities in the REIT’s portfolio now is 60%.

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