JV Acquires 37-Property Healthcare Real Estate Portfolio From Broadstone Net Lease

Joint venture partners Remedy Medical Properties and Kayne Anderson Real Estate, together the nation’s largest private owners of healthcare real estate, announced the acquisition of a portfolio of 37 healthcare properties from Broadstone Net Lease, an industrial-focused net lease REIT, for $252 million.

The acquisition closed on March 28.

“This transaction provides a unique opportunity to curate a large-scale portfolio of high-quality medical properties,” said Remedy Founder Peter Westmeyer. “We view this as a highly strategic investment that enables us to grow our holdings in core geographies, while also providing an entry point into new markets.”

High-Quality Portfolio of Medical Properties

The portfolio totals more than 708,000 square feet in 13 states, and each property is 100% leased. The 37 properties were selected from a larger collection of healthcare assets designated for sale by Broadstone as part of its plan to focus on core net lease assets in the industrial, retail, and restaurant sectors.

“We are excited to expand our footprint with some of our most prized tenant relationships, and also value the opportunity to develop new relationships with several best-in-class health systems and independent physician groups,” Westmeyer said. “As a firm specializing in healthcare real estate, Remedy is familiar with the unique needs of the industry and has earned a reputation for flexibility and responsiveness to our tenants.”

The portfolio includes properties leased by leading health systems and physician groups, including Advocate, Emerge Ortho, Froedert Health, IU Health, Tampa General, TGH Imaging and USPI. Prominent markets within the portfolio include Chicago, Houston, Charlotte, Indianapolis, Seattle, Milwaukee, Tampa and Arlington, Texas.

“The portfolio features specialty uses and practices, including ambulatory surgery centers (ASCs), imaging, and surgical hospitals. Due to the high build-out costs and capital investment, these tenants have a high likelihood of renewing upon lease expiration,” said Lee Asher, senior managing director, medical office, for Kayne Anderson Real Estate, noting that Remedy has already begun the process of extending leases with tenants. “With durable annual net operating income (NOI) growth, coupled with 100% occupancy in each facility, the assets will deliver a steady, predictable and growing income stream for years to come.”

JLL served as the broker for the transaction.