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Remedy And MedProperties Form $350 Million Medical Office Building Joint Venture

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Remedy Medical Properties and MedProperties Realty Advisors LLC formed a $350 million-plus joint venture to recapitalize an 11-state, 23-asset healthcare real estate portfolio totaling more than 1 million square feet owned by MedProperties.

Capital One provided senior debt for the transaction. Terms were not disclosed. The CBRE Healthcare & Life Sciences Capital Markets team marketed the portfolio.

The portfolio contains primarily medical office buildings as well as some post-acute facilities, including a rehabilitation hospital and ambulatory surgery center in Texas and rehabilitation hospital in Ohio. The properties are located in Texas (eight facilities), Florida (two), Pennsylvania (two),  Ohio (two), Kentucky (two) and one each in Tennessee, New York, North Carolina and Missouri.

The properties are located in some of the country’s top metropolitan areas and strategic, secondary markets. The assets are 94 percent occupied and 71 percent leased by high-caliber investment-grade tenants, including leading hospitals and health systems. One of the properties in the portfolio is Founders Square, a 35,000-square-foot medical office building in Naples, Fla., developed in 2020 by MedProperties and Catalyst Healthcare Real Estate.

Investment-grade healthcare tenants include: Baylor Scott & White, Children’s Hospital of Los Angeles, CommonSpirit, Rady Children’s Hospital, U.S. Department of Veterans Affairs, University of Southern California, UF (University of Florida) Health and WVU (West Virginia University) Medicine.

Deal Details

Darryl Freling, managing principal of Dallas-based MedProperties, said in a prepared statement his company aggregated a large number of assets through the years through its various funds and investment partnerships. In fall 2020, the firm’s leadership decided to offer a portfolio of about a two dozen of those properties as a recapitalization investment opportunity rather than an outright sale. He said the offering was taken to market in early 2021 and Remedy emerged as the joint venture partner in summer 2021.

The joint venture enabled Chicago-based Remedy, the nation’s largest owner of medical properties, to acquire a majority interest in another high-quality portfolio that complements its own holdings. Remedy’s properties total more than 26 million square feet across 42 states.

Joe Magliochetti, chief investment officer for Remedy, said in prepared remarks the portfolio is a logical addition to Remedy’s holdings and complements his company’s existing assets in terms of geography and tenancy.

The two companies have transacted smaller deals in the past and Remedy has made previous recapitalization deals with other private equity HRE investors. But this was the first time Remedy had done a transaction of this size with a private equity firm that was also another operator and competitor.

Earlier MOB Deals

In May, Remedy paid $55.2 million for Andover Medical Center, a 69,992-square-foot medical office property in the Boston suburb of Andover, Mass., owned by EverWest Real Estate Investors. The deal nearly doubled Remedy’s metro Boston footprint.

A month earlier, Remedy teamed with Kayne Real Estate Advisors in a joint venture to acquire Gresham Station Medical Plaza, a four-building, 100,419-square-foot medical office campus in Gresham, Ore. The joint venture paid $30.9 million for the Class B asset, according to public records. CommercialEdge data stated the previous owner was Stockdale Capital Partners, which had owned the property since 2017.

In one of its recent deals, MedProperties Fund III acquired a 67,060-square-foot multi-tenant medical office building in Glendale, Calif. The six-story facility is located on the campus of CommonSpirit-affiliated Glendale Memorial Hospital.

 

Source: Commercial Property Executive

Dallas Investors Buy The Las Colinas Medical Building In Irving, Texas

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Dallas-based Ridgeline Capital Partners has purchased a 70,000-square-foot medical office building in Irving.

The three-story building is at 6121 N. State Highway 161 and was acquired in a joint venture with Harrison Street, a Chicago-based investor. The building was constructed in 2019 to house primary care physicians.

The property is near Medical City Las Colinas hospital and is more than 80% leased to tenants including UT Southwestern Medical Center. An ambulatory surgery center will open in the building early next year.

“This is a medical campus with best-in-class tenants that provide a wide range of services for patients in one convenient location,” Jeff Axley, managing principal for Ridgeline, said in a statement. “The building was attractive to us due to its triple A credit-rated anchor tenant UT Southwestern Medical Center, Ambulatory Surgery Center and strategic location adjacent to Healthcare Associates of Texas, which provide additional primary care patient referrals to our tenants.”

Ridgeline Capital Partners acquires and operates medical office buildings, health care real estate and behavioral health facilities in Texas and the Southeast.

 

Source: The Dallas Morning News

Flagler Health, UF Health Sign Letter Of Intent To Collaborate On Health Campus

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St. Augustine, Fla.-based Flagler Health+ has signed a letter of intent with Gainsville-based University of Florida Health to collaborate on a comprehensive health campus in Florida.

If a final deal is reached, the healthcare campus would be built on a 40-acre parcel of land in St. Johns, Fla., which was bought last year by Flagler. The land is known as Flagler’s Durbin Park Campus.

With the letter of intent, which is nonbinding, the two organizations will explore options for the healthcare campus. The options being considered include building hospital facilities and ambulatory surgery centers, as well as establishing space for medical residency programs or other educational programs.

Flagler Health+ already plans to build its health village on the parcel, but is now looking to expand its health campus with UF Health. Flagler expects to break ground on the health village this fall.

“Collaboration is an important part of our strategy at Flagler Health+, as we look to create individualized experiences and customized service offerings for the distinctly unique communities we serve today, and those we will serve in the future,” said Flagler Health+ President & CEO Jason Barrett.

“We are looking forward to continuing discussions with Flagler Health+ to establish shared goals on behalf of residents of the region,” said David Nelson, MD, president of UF Health.

 

Source: Becker’s Hospital Review