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Dallas-Based Big Sky Forms $1 Billion Joint Venture With Off-Shore Institutional Investor

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Big Sky Medical Real Estate, a Dallas-based healthcare real estate investment management firm led by well-known industry veteran Jason L. Signor, announced this morning that it has formed a $1 billion joint venture with “an off-shore, new-entrant, institutional investor.”

The new venture, which seeks to acquire medical office buildings and surgery centers, was seeded by a $400 million-plus MOB portfolio that was aggregated by the Big Sky Medical platform during the past year.

The formation of the JV was facilitated by Big Sky and the Healthcare Capital Markets and International Capital Markets teams of Newmark Group Inc.

 

Source: HREI

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

2021 To Break Medical Office Building Sales Record

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Total medical office building (MOB) sales volume last year is likely to surpass $16 billion, breaking the previous record of $15.6 billion, set in 2015.

Final medical office building (MOB) sales for 2021 are still being tabulated, but preliminary data from Revista suggests that last year’s total volume will surpass $16 billon, breaking the previous record of $15.6 billion in MOB sales recorded in 2015. (IMAGE CREDIT: Revista)

That’s according to Arnold, Md.-based Revista, a healthcare real estate (HRE) data firm that shared its preliminary 2021 findings during its Fourth Quarter (4Q) 2021 Subscriber Webcast Jan. 25.

As of late January, Revista Principal Elisa Infante Freeman told listeners, the MOB sales volume for 2021 stood at $15.3 billion. However, that figure was based on preliminary data, meaning Revista had not yet gathered or compiled all of the transactions that took place late in the year.

“My guess is, by the time we release final stats in March, we’ll be at (a record MOB volume for 2021),” Ms. Freeman said during the webcast, adding that the firm will provide more detailed data during its upcoming “2022 Medical Real Estate Investment Forum,” which will be held in Coronado, Calif., outside of San Diego, March 2-4.

Regardless of the final tally, last year’s record-setting level of MOB sales activity also blew away the total for 2020 – which wasn’t a bad year, either. Despite the COVID-19 pandemic, the 2020 total came in at $11.7 million, keeping intact a streak of seven straight years (now eight) with the annual volume topping $11 billion.

The relatively strong sales volume in 2020, followed by an increase of more than 30 percent in 2021, add to the growing heap of evidence that MOBs are a crisis-resistant, safe harbor investment that can withstand difficult times, including recessions and pandemics. It’s a thesis that veteran MOB investors have embraced for many years, and one that has more recently attracted many new entrants to the space.

 

Source: HREI