Murfreesboro, TN-based National Health Investors has filed a lawsuit against Toledo, OH-based Welltower and some of its subsidiaries, asserting that the latter real estate investment trust “failed repeatedly to honor their legal obligations to NHI” and now owes more than $14.1 million in back rent related to Holiday Retirement properties, NHI announced Monday afternoon.
Additional plaintiffs in the lawsuit, which was filed in Delaware, include NHI-REIT of Next House, Myrtle Beach Retirement Resident and Vorhees Retirement Residence.
NHI claims that the defendants acquired assets from Holiday that included leases to NHI senior living communities and then “fraudulently induced NHI to consent to the assignment of the leases, and then immediately failed to pay rent or provide a promised security agreement that was intended to secure against their default, all as part of an effort to pressure NHI to agree to new conditions outside the assignment agreement or force a sale of the properties to the Welltower Entities.”
In a Nov. 29 business update, NHI said it received no rent for the third quarter ($4.8 million owed) or fourth quarter ($4.3 million) from its tenant for its legacy Holiday portfolio of 17 properties. The business update did not name the tenant but said it was “a public healthcare REIT.”
At the time, NHI said it had sent a default notice to the tenant and continued to hold $8.8 million in Holiday security deposits.
Welltower is the largest owner of senior living communities in the United States, according to the 2021 ASHA 50 list compiled by the American Seniors Housing Association. NHI is No. 7 on the same list.
Welltower’s acquisition of 86 Holiday owned and leased senior living communities for $1.58 billion was one of the big senior living stories of 2021.