CARMEL, IN, Dec. 9, 2013 /PRNewswire/ – HealthLease Properties Real Estate
Investment Trust (HLP.UN) (“HealthLease” or “the REIT”) acquired a
newly-built, triple-net leased, 100-unit seniors housing and care
facility from Mainstreet Property Group, LLC (“Mainstreet”), the asset
manager for the REIT. The facility is leased on a triple-net basis to
an operator that is owned fifty percent (50%) by Life Care Services
(“LCS”), a leading US provider of seniors housing and care, with
retirement communities serving over 28,000 residents in 27 states, and
fifty percent (50%) by an affiliate of Mainstreet.

The facility, Wellbrooke of Crawfordsville, is located in Montgomery
County, Indiana, and marks the fourth Wellbrooke-branded facility in
the state. As with the other properties, Crawfordsville is a Mainstreet
Next Generation™ design that transforms seniors housing and care into a
hospitality experience by incorporating hotel-like amenities and
concierge-based services. Of the 100 units at Crawfordsville, 70 are
licensed to provide skilled nursing, rehabilitation and therapy
services, while the other 30 provide assisted living.

“As we continue to add Mainstreet-developed properties to our portfolio,
we are building a strong brand presence as the leading owner of
high-quality seniors’ housing and care properties,” stated Zeke Turner,
Chairman and CEO of the REIT. “This market-leading position helps us
attract great operators as tenants who recognize that HealthLease
facilities will enable them to provide the best care for their
consumers.”

Crawfordsville 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. HealthLease acquired the property for its appraised value
of $16,980,000 subject to post-closing adjustments. Part of the
consideration to Mainstreet is expected to be from the issuance 181,246
Class B limited partnership units of MPG Healthcare LP, a subsidiary of
the REIT, at a price of CDN$9.71 per unit, subject to the approval of
the TSX. The MPG Healthcare LP units are exchangeable into REIT units
on a one-to-one basis.

Wellbrooke of Crawfordsville is the third Mainstreet-developed property
to be acquired by the REIT post-IPO. Mainstreet has informed the REIT
that it has a deep pipeline of development opportunities, including
eight properties currently under development that will be offered to
the REIT upon completion in 2014 with another twelve expected in 2015
and beyond.

To continue to solidify its future acquisition opportunities,
HealthLease today also announced that it has committed to an investment
relationship with Mainstreet that will advance the development
pipeline.

HealthLease has invested US$20 million in the development of between 12
to 16 seniors’ housing and care facilities in the United States over
the next year. HealthLease’s investment will consist of US$15 million
of mezzanine financing, which is targeted to produce an annual return
of 14% on funds invested by the REIT and US$5 million of equity
financing, which is targeted to produce an annual return of 25% on
funds invested by the REIT. Mainstreet has committed US$5 million of
equity financing to the developments.

“Our relationship with Mainstreet has enabled us to significantly grow
the REIT in a relatively short period of time with high-quality assets
that attract leading seniors’ housing and care operators,” said Zeke
Turner, Chairman and CEO. “This investment by HealthLease will help us
grow the pipeline of acquisitions, allow us to achieve scale and
deliver long-term value to our unitholders. I am pleased with our
team’s innovative effort structuring an investment that provides access
to the upside associated with internal development, while still
generating current income to the REIT. The unique relationship between
Mainstreet and HealthLease is creating significant value for
unitholders.”

Mainstreet Property Group LLC is a leading developer of seniors’ housing
and care facilities that has completed over $200 million of property
development since 2002. Their unique approach is to create Health Care
Resorts™ that offer high-end, hotel-like design. The result is a
hospitality-centered product incorporating concierge-based services to
specifically cater to the evolving demands of the growing senior
population.

Additionally, Marvin L. White was appointed to the Board of Trustees.
Marvin is currently the System Vice President & Chief Financial Officer
of St. Vincent Health in Indiana.

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 45 properties – 12 in two Canadian provinces
and 33 in eight U.S. states – for a total of 4,435 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 6,
2013 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