AdCare Health Systems, Inc., a self-managed healthcare real estate investment company that invests primarily in real estate purposed for senior living and long-term healthcare, announced it has signed a letter of intent to purchase an assisted living facility with 106 operational beds located in Alabama for $5.5 million.

The Company also announced it has executed a letter of intent with an affiliate of C.Ross Management, LLC to lease the facility upon purchase. C.Ross, AdCare's largest tenant, operates 21 facilities in Georgia and Alabama. The terms of the long-term lease agreement are expected to include a 13-year term with initial annual cash rent of $450,000 in the first year and a 2% annual rent escalator.

Bill McBride, AdCare's Chairman and Chief Executive Officer, commented, "The purchase of this facility at an attractive valuation provides us with the opportunity to deploy cash in a manner that is accretive to shareholders and expands our presence in Alabama. Furthermore, we are teaming up with our largest operator, C.Ross Management who operates seven of our facilities, including two facilities in Alabama."

The company intends to finance the acquisition with conventional mortgage debt and cash on hand. The purchase is expected to close in the second quarter of 2017. The purchase of the facility and the lease to an affiliate of C.R. Management is subject to, among other things, satisfactory due diligence, debt financing and the negotiation and execution of a definitive purchase agreement and lease agreement, each of which will contain customary representations, warranties, covenants and closing conditions. There is no assurance that this transaction will be completed on the terms described in this press release or that they will be completed at all.