RE:Corona houses
LOS ANGELES, Oct. 10, 2017 (GLOBE NEWSWIRE) -- BLVD Centers Corporation (“BLVD” or the “Company”) (TSXV:CXV), a leading company in the United States addiction recovery industry, today announced it has completed the expansion of its inland Los Angeles Pod, which includes a new outpatient (“IOP”) center with capacity for up to 35 patients for daily treatment, as well as the acquisition of real estate occupied by the residential centers.
BLVD purchased two large homes with several acres of land that it was previously leasing. This residential center acquisition was timed to coincide with the completion of the new IOP center, which is located in close proximity to the existing twelve bed residential center. Previously, residential patients were referred out to other IOP centers not owned by BLVD. With the completion of the IOP center, once fully ramped, all appropriate residential patients will be able to transition to the new IOP and the revenue can be retained by BLVD rather than lost to its competitors.
“This is the first expansion of a new center the Company has had in over five quarters,” said CEO, Chris Heath. “I am proud of our talented launch team for completing this pod. It is a credit to our new business model that we are able to transition our focus from managing existing centers to building new ones. I am looking forward to producing financial results that reflect our growth.”
“I am also pleased that we put our excess cash to use to increase our hard assets while gaining full control over the real estate in which we operate,” continued Mr. Heath. “I believe we will see a nice return from owning these properties and it gives BLVD a bump in cash flow as our overhead from operating these centers is decreased through direct ownership. We continue to execute on our expansion plans and I feel confident that we will see another few centers open soon with commensurate revenue to follow.”
The purchase price of the combined residential centers was approximately $3.5M, for the two large complexes. The Company leveraged approximately $2M of the purchase price with a real estate loan bearing 9% interest. In addition, the Board issued an additional 2,300,000 options to parties at BLVD that are key to the success of the new business model. All options have a strike price of $0.11, vest 1/3 each in September 2018, 2019 and 2020 respectively, and have a 10-year exercise provision.