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Transactions: The year’s largest MOB deal is likely to close in Q4

DOC to acquire 15 MOBs in eight states for $764.3M; sources indicate Landmark is the seller

By John B. Mugford

The largest building in the Landmark MOB Portfolio is on the University of Florida (UF) Health campus in Jacksonville, Fla.; it has 211,975 square feet of space. (Photo courtesy of Landmark)

In what healthcare real estate (HRE) sector sources say will likely end up as the biggest — by dollar value — medical office building (MOB) portfolio sale of 2021, Milwaukee-based Physicians Realty Trust Inc. (NYSE: DOC) has entered an agreement to acquire a portfolio of 15 MOBs with about 1.46 million square feet of space.

The price, according to DOC, will be $764.3 million, or about $523 per square foot (PSF).

In a news release from the publicly traded real estate investment trust (REIT), DOC said the transaction will likely close in the fourth quarter (Q4) at a capitalization (cap) rate, or first-year estimated return, of 4.9 percent.

According to DOC, which is considered a “pure play MOB” REIT and, as of June, owned 274 assets with more than 14.5 million square feet and valued at about $5 billion, the portfolio includes facilities in eight different states, with the greatest concentration being in Florida and Michigan.

With a total occupancy of about 95 percent and a remaining weighted average lease term (WALT) of 7.4 years, the portfolio’s tenancy is 74 percent occupied by “investment grade health systems or their subsidiaries.”

While DOC did not identify the seller, several industry sources inform HREI™ that it is

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