Transactions: Lillibridge, Grubb & Ellis acquire MOBs


By John Mugford

Medical office building (MOB) sales have fallen dramatically because of the recession and tight credit market. Yet at least two firms have continued to make MOB acquisitions in recent months in unrelated transactions.

They are Chicago-based Lillibridge and Santa Ana, Calif.-based Grubb & Ellis Healthcare REIT (real estate investment trust).

The two firms continued on their buying ways in recent weeks, as Lillibridge acquired a 13-building, 255,000 square foot portfolio in Decatur, Ill., for $31 million, or about $126 per square foot (PSF). The company acquired the buildings from Decatur Memorial Hospital.

In an unrelated deal, the Grubb & Ellis REIT, a privately held REIT sponsored by Grubb & Ellis Co. (NYSE: GBE), acquired a four-building, 185,000 square foot portfolio in Wisconsin from an unnamed seller.

While the REIT did not disclose what it paid for the Wisconsin properties, Healthcare Real Estate Insights™ estimates the price to be about $34.6 million, or just more than $187 per square foot (PSF). (We estimated the price paid by comparing Grubb & Ellis’s most recent statements and news releases revealing the number of buildings and the total value of the company’s MOB portfolio.)

The 13 buildings that compose the new Lillibridge are 95 percent occupied, and 10 of the buildings are located on the campus of Decatur Memorial, a 334-bed hospital in the central part of the state. Five of the MOBs in the portfolio are fully occupied by the hospital, while one is fully leased to the Southern Illinois Family Practice residency program.

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