LTC Properties (LTC) Falls as Lessees Preferred Care Files For Bankruptcy

LTC Properties (NYSE: LTC) is down 2.5% in early trade Wednesday after one of its lessees, Preferred Care, Inc. filed for Chapter 11 bankruptcy resulting from a multi-million dollar legal judgement in a lawsuit against Preferred and certain affiliated entities.

Preferred leases 26 properties under two master leases from the Company. None of those 26 properties are in Kentucky or New Mexico, and the Preferred operating entities that sublease those properties did not file for bankruptcy. Those 26 properties are in Arizona, Colorado, Iowa, Kansas, Texas and Virginia, and represented 6.8% of the Company’s annual income as of September 30, 2017.

LTC does not believe Preferred’s bankruptcy will have a material impact on the Company’s future financial results. Preferred has paid November rent to the Company, and the Company expects that future rent payments by Preferred will be made on time. No pre-petition claims have been made, nor does the Company believe that any post-petition claims will be made, related to the Preferred properties owned by the Company.

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