| Item 7.01 |
Regulation FD Disclosure |
Correspondence with Financial Professionals and Broker Dealers
Filed as Exhibit 99.1 to this Current Report, and incorporated herein by reference, is the text of a correspondence from CNL Healthcare Properties, Inc. (the “Company”) to financial professionals and broker dealers who participated in the Company’s public offerings, notifying them that the Company (i) plans to prepare an estimated net asset value (“NAV”) per share of the Company’s common stock as of December 31, 2023 (the “2023 NAV”), (ii) anticipates announcing the 2023 NAV on or about March 12, 2024, (iii) recently engaged Robert A. Stanger & Co., Inc., an independent investment banking firm (“Stanger”), to assist the Company with the preparation of the 2023 NAV, and (iv) will hold a webinar on March 14, 2024, at 2:30 p.m., Eastern Time, to review the 2023 NAV.
Pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”), the information contained in this Item 7.01 disclosure, including Exhibit 99.1 and the information set forth therein, is deemed to have been furnished and shall not be deemed to be “filed” under the Securities Exchange Act of 1934. By furnishing the information contained in this Item 7.01 disclosure, including Exhibit 99.1, the Company makes no admission as to the materiality of such information.
Determination of Net Asset Value per Share as of December 31, 2023
In order to assist Financial Industry Regulatory Authority (“FINRA”) members and their associated persons who participated in the Company’s public offerings in meeting their customer account statement reporting obligations under National Association of Securities Dealers Conduct Rule 2340, the Company prepares and announces at least annually an estimated NAV per share of its common stock, the method by which such NAV was developed, and the date of the data used to develop the estimated NAV per share.
The Company now intends to establish and announce the 2023 NAV, on or about March 12, 2024. To assist the board of directors of the Company (the “Board”) and the Company’s valuation committee, which is comprised solely of the Company’s independent directors (the “Valuation Committee”), with establishing the 2023 NAV as of December 31, 2023 (the “Valuation Date”), the Company engaged Stanger to provide a net asset value analysis of the Company. The engagement of Stanger was based on a few factors including Stanger’s experience in the valuation of assets similar to those owned by the Company. Upon the receipt of a net asset value analysis of the Company from Stanger, which will contain, among other information, a range of per share net asset values for the Company’s common stock as of the Valuation Date (a “Valuation Report”), the Valuation Committee will consider the reasonableness of the range of per share values and make a recommendation to the Board, and the Board will approve and adopt an estimated 2023 NAV.
The Company will establish the 2023 NAV in accordance with the Company’s valuation policy and certain recommendations and methodologies of the Institute for Portfolio Alternatives, a trade association for non-listed direct investment vehicles (“IPA”), as set forth in IPA Practice Guideline 2013-01 “Valuations of Publicly Registered Non-Listed REITs” (“IPA Practice Guideline 2013-01”). In developing its valuation analysis of the Company, Stanger will also consider IPA Practice Guideline 2013-01.
Robert A. Stanger & Co., Inc. is a nationally recognized investment banking firm specializing in providing strategic planning, investment banking, financial advisory, fairness opinion and valuation services to partnerships, real estate investment trusts and real estate advisory and management companies. Stanger possesses substantial experience in the valuation of assets similar to those owned by the Company and regularly undertakes the valuation of securities. For the preparation of the Valuation Report, the Company will pay Stanger a customary fee for services of this nature, no part of which was contingent relating to the provision of services or specific findings.