Responding to the challenges facing the senior living industry amidst the COVID-19 pandemic, real estate investment trust Ventas announced Monday the renegotiation of Brookdale Senior Living’s 121 community triple-net master lease arrangements. 

Under the revised agreement, Brookdale’s annual combined rent dropped to $100 million from $182 million a year, according to company filings. In exchange, Brookdale must pay Ventas $162 million in cash and 16.3 million shares of common stock. Brookdale also must pay the REIT a $45 million note that’s due in 2025.

“The arrangements … benefit both companies, by providing Ventas shareholders with certainty, flexibility and the opportunity for upside, enhancing Brookdale’s stability and liquidity, and creating the most conducive environment for Brookdale to operate our communities safely and productively,” Ventas Chairman and CEO Debra A. Cafaro said.

As part of the agreement, Brookdale also transferred ownership of five senior living communities representing 471 units to Ventas.

“These agreements represent a significant step forward toward improving our long-term financial position,” Brookdale President and CEO Lucinda “Cindy” Baier said. “The lease amendment transaction provides a permanent rent reduction, which will help mitigate the business impact of COVID-19, significantly improves our cash flow and lease coverage over the remaining lease period, and eliminates financial covenants.”