HealthLease Properties REIT Announces Completion of Acquisitions of Five Senior Housing and Care properties

CARMEL, IN, May 21, 2014 /CNW/ - HealthLease Properties Real Estate Investment Trust (HLP.UN) ("HealthLease" or "the REIT") announced today that it has successfully completed the previously announced acquisitions of a senior housing and care portfolio, Smith Packet III ("SP III") and a newly-built, triple-net leased, 100-unit seniors housing and care facilities from Mainstreet Property Group, LLC ("Mainstreet"), Wellbrooke of Kokomo.

The SP III portfolio consists of four U.S. properties totaling 365 beds, including one property each in Virginia and Pennsylvania and two in North Carolina, with a purchase price of US$49.4 million. The portfolio is triple-net leased and operated by Saber Healthcare Group, LLC ("Saber").

"We are very pleased to announce these acquisitions, which demonstrate our ability to execute on two components of our growth strategy," said Zeke Turner, Chairman and CEO of the REIT. "One is to identify and acquire high quality facilities managed by strong operators, and the second is to add pre-leased properties to our portfolio through our relationship with Mainstreet Property Group, the leading developer of Next Generation™ transitional care facilities."

Located in Indiana, Wellbrooke of Kokomo was acquired under the REIT's pre-existing development agreement with Mainstreet, which provides the REIT with a right to acquire any seniors housing and care properties developed by Mainstreet. The facility is leased on a triple-net lease basis to Life Care Services ("LCS"), a leading US provider of seniors housing and care, with retirement communities serving over 32,000 residents in 31 states. HealthLease acquired the property for an aggregate purchase price of US$17.9 million.

The REIT previously announced a board-approved amendment to the management agreement with its external manager, Mainstreet. This amendment provides Mainstreet with an annual incentive fee which is based on 15% of AFFO per unit above an incentive hurdle rate to be set by the Board of Trustees. This rate has now been set at $1.01 per unit of AFFO for the 2014 calendar year.

About HealthLease Properties Real Estate Investment Trust
HealthLease Properties Real Estate Investment Trust (TSX: HLP.UN) owns one of the youngest and highest quality portfolios of seniors housing and care facilities with 51 properties - 12 in two Canadian provinces and 35 in eight U.S. states - for a total of 5,048 beds.  The facilities are leased to experienced tenant operators who have significant operational experience. The leases are structured as long-term and triple-net: features that provide stability and dependability to the REIT's cash flow and distributions.  The REIT's best-in-class portfolio meets the growing demands of modern seniors by emphasizing features such as hotel-like design, private rooms and baths and hospitality-inspired amenities.  For more information, visit www.hlpreit.com.

Forward-Looking Information
This news release contains forward-looking statements which reflect the REIT's current expectations regarding future events. The forward-looking statements involve risks and uncertainties, including those set forth in the REIT's Annual Information Form dated March 11, 2014 under the section "Risk Factors," a copy of which can be obtained at www.sedar.com. In addition, the securities to be acquired by the REIT in the fund will be relatively illiquid and the REIT's acquisition will represent a minority interest and, as such, the REIT will have no control over the Fund.  Actual results could differ materially from those projected herein. The REIT disclaims any obligation to update these forward-looking statements.

The securities of Mainstreet Development Fund II, L.P., have not been, nor will they be, registered under the United States Securities Act of 1933, as amended (the "Act") and may not be offered or sold in the United States or Canada without registration or the filing of a prospectus or an applicable exemption from the registration or prospectus requirements of the Act or applicable Canadian securities laws. This news release does not constitute an offer for sale of these securities in the United States of America or Canada.

SOURCE HealthLease Properties Real Estate Investment Trust

For further information:

Adlai Chester
Chief Financial Officer
HealthLease Properties REIT
(317) 420-0205

Renée Lam
Investor Relations
TMX Equicom
(416) 815-0700 ext. 258