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Transactions: Anchor, Carlyle buy a large MOB in Greenville, S.C.

The deal could also involve a second MOB, for a total investment topping $50M

The Anchor/Carlyle JV acquired the 80,000 square foot, off-campus facility at 1025 Verdae Blvd. in a sale-leaseback transaction. (Photo courtesy of Anchor Health Properties)

GREENVILLE, S.C. – In a joint venture (JV) partnership, Wilmington, Del.-based Anchor Health Properties (Anchor) and its frequent co-investor, Washington, D.C.-based The Carlyle Group, recently acquired an 80,000 square foot MOB in the rapidly growing Greenville market.

The Anchor/Carlyle JV acquired the 80,000 square foot, off-campus facility at 1025 Verdae Blvd. in a sale-leaseback transaction from Greenville-based Internal Medicine Associates (IMA), a multispecialty medical practice with 29 physicians.

The other tenant in the fully occupied MOB is Greenville Health System (GHS), which has eight hospitals and more than 100 outpatient locations in upstate South Carolina.

The multi-story “Class A” facility, as Anchor refers to it, is about 6.2 miles west of downtown and a couple of miles from Greenville Health System’s Patewood Memorial Hospital.

While the price has yet to be revealed for the sale-leaseback transaction, James Schmid, Anchor Health Properties’ chief investment officer, tells HREI that the company has also structured a “capital solution” for the potential purchase of an adjacent, under-construction 60,000 MOB scheduled for completion by IMA this coming March.

HREI estimates that the total deal, for both phases, would likely top $50 million.

This estimate is based on the trailing 12-month average price per square (PSF) foot paid for existing MOBs nationwide of $311 as of the fourth quarter (Q4) of 2018, according to real estate researcher Real Capital Analytics (RCA). That would mean that the price paid for the existing 80,000 square foot MOB would be nearly $25 million, based on RCA’s average PSF.

Industry sources tell us that the PSF to construct a new, Class A MOB such as the one under construction on Verdae Boulevard would likely be about $400, meaning the cost of that facility would be about $24 million.

However, based on demand for the two-MOB portfolio, we would estimate the deal to top $50 million.

“This is a great property with two excellent tenants, and that was reflected in the strong demand shown in the property from a number of institutional investors and REITs,” Mr. Schmid noted. “It was very important for the seller to close the sale of the first building before the end of the year (2018), and we were able to close in six weeks.”

According to Anchor Health Properties, the MOB serves as a “mission critical outpatient” site for GHS’s Patewood Memorial Hospital campus, which has a number of MOBs that are filled to capacity. The outpatient campus also serves as the flagship location for IMA.

Anchor will provide both asset and property management services for the campus; the new deal brings its portfolio to more than 4 million square feet of owned and managed MOBs.

Marketing the property and representing the seller was Peter Couchell of Greenville-based NAI Earle Furman. McLean, Va.-based Capital One provided secured debt financing for the acquisition.

News Release: Anchor Health Properties Expands Southeast Footprint with Greenville, South Carolina Investment

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