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Newmark Arranges Disposition Of 15-MOB Portfolio Across Seven High-Growth Sunbelt States And Facilitates Acquisition Financing For The Assets

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Newmark announed it has facilitated the sale of the Southern Core Medical Office Portfolio, a 15-building, approximately 400,000-square-foot medical office building portfolio located across seven Sunbelt states.

Newmark Executive Managing Director Ben Appel, Senior Managing Directors Jay Miele and Michael Greeley and Managing Director John Nero of Newmark’s Healthcare Capital Markets Group represented the seller, Montecito Medical, and advised the buyer, KKR Real Estate Select Trust Inc. (KREST) on debt financing which was provided by BMO Harris Healthcare Real Estate Finance.

“This acquisition provides instant scale across high-growth Sunbelt markets, making it an attractive first investment in core healthcare real estate assets for KREST,” said Appel. “With Montecito Medical retaining its interest in and operational responsibility for the portfolio, this investment is able to provide long-term, stable income for its new ownership while aligning with Montecito Medical’s operational expertise in the healthcare sector.”

The portfolio comprises 15 outpatient medical office buildings and ambulatory surgery centers located across the southern United States in growth submarkets within Arkansas, Florida, Georgia, North Carolina, Tennessee, Texas and South Carolina. The portfolio is over 99% leased to a mix of leading investment-grade health systems and specialist medical groups in practice areas including gastroenterology, nephrology, orthopedics, ophthalmology and urology.

Newmark’s Healthcare Capital Markets group worked in partnership with the firm’s Debt and Structured Finance practice to arrange portfolio financing for the acquirer.

“We appreciate the opportunity to support KREST on this important portfolio financing, which was well received by the lender market given the portfolio’s attractive investment fundamentals and quality provider tenancy,” said John Nero, Managing Director.

 

Source: HREI

Montecito Medical Acquires Medical Office Complex in Clarksville, Tennessee

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Montecito Medical Real Estate, a premier owner of medical office properties throughout the U.S., has completed the acquisition of a prime medical office complex.

The two buildings, both 100-percent occupied, serve as medical offices for Premier Medical Group, one of the largest physician-owned, multi-specialty groups in the Clarksville-Montgomery County market area, which is roughly 45 miles northwest of Nashville.

“We’re especially pleased about this acquisition,” said Chip Conk, CEO of Montecito Medical. “We have been incredibly active in the market in 2018, and we’re excited about closing out what has been a banner year by acquiring these two, best-in-class medical offices.  We love the Clarksville medical market, not only because it’s in our backyard, but because it’s a solid and rapidly growing area with one of the 20 fastest rates for job growth in the country. And the growth shows no sign of slowing down.”

Both two-story, Class A buildings on the complex – connected via an indoor corridor – together represent nearly 110,000 square feet.

Constructed in 2016, Building 1 is approximately 55,000 square feet. Premier Medical Group uses the space to provide family medicine, internal medicine, occupational and travel medicine, a walk-in clinic, diagnostic imaging services (CT, fluoroscopy, ultrasound, MRI and mammography) and laboratory.

Building 2 was constructed in 2018 and offers 54,000 square feet. On the lower floor, Premier provides pediatrics services to include a seven-days-a week walk-in clinic. Its upper floor is home to obstetrics and gynecology along with the practice’s administrative, business offices and scheduling services.

Founded in 1995, Premier Medical Group today ranks among Clarksville’s 20 largest employers. The group, which maintains an off-site ENT clinic, consists of 36 physicians and more than 300 employees. In 2017, Premier provided services for 225,560 patient visits.

Making this property even more attractive, located adjacent to the Premier Medical Office complex is 281-bed Tennova Healthcare Hospital, the largest of five hospitals within a 30-mile radius. Doctors at Premier have staff privileges at Tennova Hospital. The property is also close to major retail sites and some of the region’s top employers. Located just west of the property is Governors Square Mall – a million-square-foot enclosed shopping mall that is the center of Clarksville’s retail and commercial district. Nearby Austin Peay State University, Fort Campbell military complex, Hankook Tire Plant and LG Electronics also are among the largest employers in this booming market.

Premier Medical Group Chief Administrator Mike Carrigan, M.D. said, “We are pleased with the sale of our property to Montecito, as we desired a top-notch company to oversee what we so painstakingly built. PMG was formed to provide quality medical care, and we will maintain this path with Montecito as our new landlord. At this juncture we can devote 100 percent of our focus and efforts on patient care.”

This transaction was brokered by Anthony Lunceford and Joe Massa who are Executive Managing Directors of Colliers International Healthcare Investment Services. Lunceford and Massa both worked closely with Montecito to get these prime medical real estate assets closed.

 

Source: BusinessWire