Physicians Realty Trust Closes On $750 Million Deal Acquiring A 14 Medical Office Building Portfolio

Physicians Realty Trust has acquired a 14-building medical office portfolio from Landmark Healthcare Facilities for approximately $750 million, in an off-market transaction.

Spread across eight states, the Class A medical facilities totaling roughly 1.4 million square feet were 95 percent leased at the time of sale. The REIT will continue to partner with Landmark in the property and facility management of the traded assets.

With most assets in Florida and Michigan, the portfolio comprises:

• 200,583-square-foot UF Health Jacksonville North in Jacksonville, Florida
• 164,186-square-foot Baptist Medical Center Belhaven in Jackson, Mississippi
• 141,205-square-foot Burns POB (professional office building) in Petoskey, Michigan
• 121,834-square-foot TGH Brandon Healthplex in Brandon, Florida
• 100,490-square-foot Beaumont POB in Sterling Heights, Michigan
• 99,055-square-foot Lafayette MOB in Lafayette, Louisiana
• 94,572-square-foot Beaumont Health and Wellness Center in Rochester Hills, Michigan
• 90,156-square-foot Hospital Hill MOB in Kansas City, Missouri
• 89,159-square-foot Raritan Bay Medical Center in Old Bridge, New Jersey
• 85,582-square-foot Saint Vincent MOB in Erie, Pennsylvania
• 81,312-square-foot Riverside MOB in Hampton, Virginia
• 73,453-square-foot Bay City MOB in Bay City, Michigan
• 57,040-square-foot Beaumont Grosse Point MOB in Grosse Pointe, Michigan
• 36,045-square-foot Yulee MOB in Yulee, Florida

Each facility is part of a hospital campus or affiliated with a health system and 75 percent of the leased space has investment-grade health systems or their subsidiaries as tenants.

Grounds For New Relationships

Considered to be the largest single transaction in the company’s history, the Landmark portfolio acquisition was originally announced in October. The initial deal included 15 medical facilities with a total price tag of approximately $764.3 million. However, a 24,972-square-foot property in Deltona, Fla., was ultimately excluded from the sale as its tenant chose to exercise its Right of First Refusal.

The deal helped Physicians Realty Trust establish 10 new health system relationships, including the University of Florida Health, Beaumont Health, Hackensack Meridian Health, Baptist Health Systems, McLaren Health Care and Allegheny Health.

Source: Commercial Property Executive