News Release: Capital One Provides Loans Totaling $311 Million to Recapitalize Medical Office Building Portfolio

The eight-story, 264,000 square foot Piedmont West Medical Office Park in Atlanta was the largest single property acquired from an MB Real Estate – Kayne Anderson joint venture on behalf of clients by CBRE Global Investors. (Photo courtesy of Cooper Carry)

Bethesda, Md. (October 16, 2017)Capital One announced today that it provided two loans totaling $311 million to recapitalize a 28-asset medical office building portfolio totaling 1.5 million square feet. The newly recapitalized borrower is a venture between an institutional investor and another joint venture between Kayne Anderson Real Estate Advisors (KAREA) and MB Real Estate (MBRE) Healthcare (KAREA/MBRE platform), which previously owned the portfolio. In addition to the principal loan, Capital One provided a loan for one property that required separate financing due to ground lease restrictions.

“The KAREA/MBRE platform has completed more than 40 transactions with Capital One,” said S. David Selznick, Kayne Anderson Real Estate Advisor’s Chief Investment Officer. “Our years of collaboration on a variety of investments gave us confidence that Capital One would be an ideal partner to develop a financing solution that aligned with our strategic plans for these assets.”

Peter Westmeyer, President and Managing Principal at MB Real Estate echoed this assessment. “There are few banks with the depth of expertise in healthcare to tackle a deal of this size and complexity,” he said. “For us, Capital One was the logical choice.”

Kayne Anderson Real Estate Advisors is a leading real estate private equity investor with dedicated equity and debt funds totaling approximately $5 billion in commitments. Kayne Anderson’s strategic joint venture with MBRE is one of the largest owners of medical office buildings in the United States. MBRE Healthcare, which owns and/or manages over 10 million square feet of medical office space, will manage the portfolio.

”Our goal was to provide to provide common ground, allowing the institutional investor to enter the medical office building market while addressing the need of Kayne Anderson and MB Real Estate to recapitalize the portfolio,” said Erik Tellefson, Managing Director for Capital One Healthcare. “We worked closely with all parties to provide a financing solution that served everyone’s interests.”

The 28 medical office buildings in the portfolio are located in 11 states and serve a diverse group of 150 tenants. Six buildings are on or adjacent to a health system campus, while the remaining properties are off campus. Eight of the buildings are each occupied by a single tenant. The portfolio is 95 percent leased.

Capital One Healthcare is a leading provider of financial services to the industry. Customers across healthcare sectors—including senior housing, healthcare services, pharmaceuticals, medical devices, healthcare IT and medical offices—rely on Capital One Healthcare to finance acquisitions, refinance existing debt, support working capital needs and fund growth initiatives. With in-depth expertise, our team of professionals creates solutions tailored to meet the needs of our customers.

About Capital One

Capital One Financial Corporation (www.capitalone.com) is a financial holding company whose subsidiaries, which include Capital One, N.A., and Capital One Bank (USA), N.A., had $239.8 billion in deposits and $350.6 billion in total assets as of June 30, 2017. Headquartered in McLean, Virginia, Capital One offers a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. Capital One, N.A. has branches located primarily in New York, Louisiana, Texas, Maryland, Virginia, New Jersey and the District of Columbia. A Fortune 500 company, Capital One trades on the New York Stock Exchange under the symbol “COF” and is included in the S&P 100 index.

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