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									  NEWS | Companies

                                                                      Loan performance, cap rates
                                                                      take hit in third quarter: NIC
» Sun Healthcare Group Inc. and
Skilled Healthcare Group shares got a boost
in late January after an analyst predicted
that reimbursement rates would not change
much this year. Gary Taylor of Citi Invest-                           By Liza Berger                                                                     2008, up from 12% in 2007.
ment Research said he does not believe that                           The troubled economy and                                                              O t her i nd icator s a l so
the Centers for Medicare & Medicaid Ser-                              rocky credit markets appear to                                                     revealed softening in the sec-
vices will significantly alter Medicare rates for                     be catching up with long-term                                                      tor. Loan volume has fallen
nursing homes and rehab care providers at a                           care, according to a new report                                                    since the first quarter of 2007
meeting next month. Sun shares have fallen                            from the National Investment                                                       when it reached $2.28 billion,
significantly since September.                                        Center for the Seniors Hous-                                                       according to NIC. The amount
                                                                      ing & Care Industry. Loan                                                          placed in the third quarter of
» Care Foundation of America, a not-                                  performance and capitaliza-                                                        2008 was $1.01 billion. That

                                                                                                                                            Photo: NIC
for-profit charity, has sued National Health                          tion rates both suffered in the                                                    compares with $1.55 billion
Investors Inc. of Murfreesboro, TN, claiming                          third quarter of 2008.            NIC President Robert Kramer                      in the second quarter.
it was overcharged when it purchased six                                 “Although loan perfor-         says loan performance deteriora-                    Occupa ncy rates were
                                                                                                        tion can be expected.
nursing homes in Florida for about $33 mil-                           mance held up well during                                                          flat to slightly higher in the
lion nearly 10 years ago. It sued in conjunc-                         the third quarter, it did fall    such, we may see some dete-                      seniors housing sector when
tion with a bankruptcy filing, which occurred                         below 99 percent for the first    rioration in loan performance                    compared to the previous
prior to a deadline to pay National Health                            time since 2005,” said Robert     during the next 18 months.”                      quarter. Skilled nursing—at
the remaining $23.2 million it owes.                                  Kramer, president of NIC, in         Loan performance decreased                    84%—remained the same.
                                                                      a statement.                      to 98.9% in the third quarter                       “Occupancy rates, as mea-
» Capital Senior Living Corp.’s board                                    “We'll need to see how         from 99.5% in the second quar-                   sured for the major metro
authorized a stock repurchase program of up                           this unfolds,” he added.          ter. Meanwhile, capitalization                   markets by our NIC MAP
to $10 million of its common stock. “Given                            “Since there is likely a good     rates–ratios used to estimate                    data service and nationwide
the current market conditions, we believe this                        amount of debt that needs to      the value of income-producing                    by the KFIs, have declined
stock repurchase program is a prudent use of                          be refinanced over the next       properties–rose for skilled nurs-                from their peaks in late 2006
our capital and demonstrates our confidence                           few years, and considering the    ing last year.                                   and early 2007,” said Lawrence
in the long-term value of Capital Senior Liv-                       
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