MOB Transactions Roundup: Global Medical REIT, Griffin-American Healthcare REIT IV
Global Medical REIT Purchases 11 MOBs for $31 Million
Baltimore-based publicly traded real estate investment trust (REIT) Global Medical REIT Inc. (NYSE: GMRE) recently completed the acquisitions of 11 properties located across South Dakota, Ohio and New Jersey. Prior to these acquisitions, the REIT maintained a presence in Tennessee, Florida, Michigan, North Carolina and Texas.
The 11 acquisitions included buildings in the Northern Ohio Medical Specialists portfolio, the Brown Clinic in Watertown, South Dakota, and the Prospect medical office building in East Orange, New Jersey. GMRE bought 9 of the 11 buildings for $25.4 million. The final two transactions are anticipated to be closed in December, pending the completion of some renovations, for about $5.4 million.
The REIT estimates it will have invested approximately $31 million in the 11 properties by the end of 2016, Commercial Property Executive reported. Including GMRE’s July acquisition of the Berks Eye clinic in Pennsylvania, the REIT’s post-initial public offering deployments add up to approximately $40 million.
GMRE worked on schedule and followed its usual strategy of purchasing purpose-built, state-of-the-art health care facilities, according to CEO David Young. “By closing the acquisitions in a timely manner we are also able to focus our attention squarely on advancing additional acquisitions through our pipeline,” Young said in a prepared statement.
Children’s Hospital of Philadelphia Sells MOB for $25.5 Million
MREF II 3550 Market LP, an affiliate of West Conshohocken, Pennsylvania-based Miller Asset Management, has purchased a medical office building from Children’s Hospital of Philadelphia for $25.5 million, Philly.com reported. The transaction closed on Sept. 13.
The 87,900-square-foot building is located in University City, Pennsylvania.
CHOP and its doctors plan to stay in the building as tenants, according to hospital spokeswoman Emily Ditomo.
Marcus & Millichap Sells Surgery Center in South Carolina for $8 Million
Marcus & Millichap recently sold the 19,729-square-foot Outpatient Surgery Center of Hilton Head for $8 million, or $405.49 per square foot, Palmetto Business Daily reported.
Built in 2004, the multi-specialty surgery center has two procedure rooms, three operating rooms and two endoscopy suites. The sale price represents a record for a medical office building in Hilton Head, South Carolina.
Marcus & Millichap arranged the sale of the building for the physician owners to a private investor, and a long-term lease is in place. Investment advisers in the Charleston, South Carolina, and Atlanta offices brought multiple offers to the building’s owners.
Healthcare Trust of America Buys Florida MOB for $10.4 Million
An affiliate of Scottsdale, Arizona-based Healthcare Trust of America Inc. (NYSE: HTA) recently purchased the Riverside Medical Center in Bradenton, Florida, for $10.4 million, according to the Sarasota Herald-Tribune.
The real estate investment trust (REIT) purchased the four-story, 57,000-square-foot medical office building in September from a company managed by Ronald Allen and John McKay, two local real estate investors.
The building’s tenants include MCR Health Services, the Manatee Diagnostic Center and veriMED Health Group.
Griffin-American Healthcare REIT IV Acquires MOBs in Alabama, North Carolina
Los Angeles-based investment and asset management company Griffin Capital Corporation and Irvine, California-based investment management firm American Healthcare Investors, the co-sponsors of Griffin-American Healthcare REIT IV, Inc., recently announced that the REIT had purchased the Iron Medical Office Building Portfolio, which includes three medical office buildings located in Sylacauga and Cullman, Alabama.
The Iron Medical Office Building Portfolio was purchased from Cullman POB II, LLC, Cullman POB Partners I, LLC and HCP Coosa MOB, LLC, all of which were represented Brookfield Financial’s John Cardiff. None of the sellers are affiliated with Griffin-American Healthcare REIT IV, which funded the purchase with cash on hand and borrowings under its line of credit with Bank of America, N.A. and KeyBank, National Association.
The Iron Medical Office Building Portfolio comprises about 204,000 square feet and is about 84% leased. Two of the buildings are located on the campus of the 145-bed Cullman Regional Medical Center, while the third is located on the campus of the Coosa Valley Medical Center, which has 248 beds.
Both Cullman Regional Medical Center, Inc. and Coosa Valley Medical Center—legally known as The Sylacauga Health Care Authority—are long-term occupants of each of the medical office properties, which have a weighted average remaining lease term of 7.4 years. Coosa Valley Medical Center, for instance, leases 100% of the Sylacauga property through January 2025. Griffin-American Healthcare REIT IV acquired a third building on the Cullman Regional Medical Center campus late last month in an unrelated transaction, leading to the ownership of the three major medical office buildings on the campus, according to a press release.
“Each of the three buildings in the Iron Medical Office Building Portfolio are of premium quality and are located on the campuses of thriving regional hospitals,” Danny Prosky, a principal of American Healthcare Investors and president and chief operating officer of Griffin-American Healthcare REIT IV, said in the press release. “Additionally, the ownership of the three premier Cullman medical office buildings provides us with significant economies of scale from a management and leasing perspective.”
Griffin-American Healthcare REIT IV also recently entered into an agreement to purchase the Mint Hill Medical Office Building, a three-story, 58,000-square-foot medical office building in Mint Hill, North Carolina.
The Mint Hill Medical Office Building is 100% triple net leased to two tenants, The Charlotte-Mecklenburg Hospital Authority and Carolinas Physicians Network, Inc. Both of the tenants are affiliates of Carolinas HealthCare System.
Several health care services are provided at Mint Hill Medical Office Building, including biorepository, cardiology, allergy, dermatology, gastroenterology, endocrinology, pulmonary and critical care, sports medicine, sleep medicine, telemedicine and urgent care.
“Mint Hill Medical Office Building would be a fine addition to the rapidly growing portfolio of Griffin-American Healthcare REIT IV,” Prosky said in a press release. “It is a modern building, 100% leased to affiliates of an investment grade credit tenant and one of the finest health care providers in the region.”
Written by Mary Kate Nelson
Companies:American Healthcare Investors, Bank of America, Carolinas HealthCare System, Children's Hospital of Philadelphia, Cullman POB II LLC, Cullman POB Partners I LLC, Global Medical REIT Inc., Griffin Capital Corporation, Griffin-American Healthcare REIT IV, HCP Coosa MOB LLC, Healthcare Trust of America Inc., Keybank, Marcus & Millichap, Miller Asset Management, MREF II 3550 Market LP