Debt and equity are ready to fund MOB and HRE deals, BOMA panelists agree
By John B. Mugford
The “Capital Markets” panel discussion during the BOMA Medical Real Estate Conference April 30 included (from left to right): Joe Magliochettiof Remedy Medical Properties, Jon Lewin of MedCraft, moderator Brannan Knott of CBRE, Peter Volas of Cleveland Clinic and Aashik Rao of Fengate Asset Management. (Photo courtesy of BOMA)
If anything has changed dramatically in the healthcare real estate (HRE) transactions market during the past year or so, it’s that there’s plenty more debt and equity available for investors.
Here’s an example of how much things have changed.
In fall 2025, Chicago-based Remedy Medical Properties, in a joint venture (JV) partnership with Kayne Anderson Real Estate, announced a deal to acquire an 18 million square foot medical outpatient building (MOB) portfolio from Welltower Inc. (NYSE: WELL) for $7.2 billion. As the Remedy-Kayne team set about trying to assemble about $4 billion in debt to pull off what would be the largest MOB deal in history, Joe Magliochetti, Remedy’s chief investment officer, said they had one big question:
“Does that level of liquidity even exist … for medical office buildings in the market?”
As it turned out, the answer was a resounding, “Yes.”
“It’s interesting to be where we are today,” Mr. Magliochetti said during an April 30 panel discussion at the recent BOMA International 2026 Medical Real Estate Conference held at the Hilton Bayfront Hotel in San Diego.
“I know we’re going to talk more about this – about the level of liquidity there is in the market,” he continued. “That liquidity, debt and equity liquidity, a year ago, some of that was less available than it is today, though you could tell it was improving…
“One of the things that was a critical ingredient in this transaction was the debt financing. We’re a leveraged buyer, like most of us in this room, and one of the key questions we had, up front, was, ‘Where can we find $4 billion worth of debt financing?’”
As it turned out, that amount of debt was indeed available to Remedy and its longtime joint venture partner, Boca Raton, Fla.-based Kayne Anderson, as the JV landed two separate first mortgage loans, with the primary debt transaction led by Capital One NA as sole bookrunner and joint lead arranger of a $3.57 billion loan. The other facility was led by Citigroup Global Markets Inc. as bookrunner and lead arranger, with J.P. Morgan and Goldman Sachs serving as participants.
“The participation of several of our lending partners in the execution was remarkably smooth, and we thought maybe that might be the trickiest part of the transaction,” Mr. Magliochetti said, “But we were able to structure it in a manner that worked with two separate debt financing pools that totaled $4 billion.
“So, I guess the lesson here is that there … is growing, and it’s still growing, institutional demand both on the debt capital side and equity capital side.”
Buying a stairway to Cleveland
As noted, Mr. Magliochetti made his remarks during the recent BOMA Medical Real Estate Conference in San Diego. Moderated by Brannan Knott, executive VP with the U.S. Healthcare Capital Markets team with CBRE Group Inc. (NYSE), the panel also included:
■ Jon Lewin, CEO of Minneapolis-based MedCraft;
■ Aashik Rao, managing director of investments with Toronto-based Fengate Asset Management; and
■ Peter Volas, senior director real estate buildings + design with Cleveland-based Cleveland Clinic.
During the session, titled “Capital Markets: Structuring Deals, Partnerships and Ground Leases,” the panelists – who were all directly involved in major capital markets transactions last year – discussed a range of other topics as well, including a look at one of the largest health system sales, or monetizations, of MOBs in nearly a decade.
That deal took place in mid-2025 and involved Cleveland Clinic’s sale of 24 MOBs with about 947,000 square feet to Minneapolis-based MedCraft, a longtime HRE firm, and its financial partner on the transaction, Toronto-based Fengate Asset Management, at a price of nearly $300 million.
Mr. Volas of Cleveland Clinic noted that plenty of decision-making and work went into moving forward with the deal.
“For a backdrop of what’s going on in the healthcare industry right now, most hospital systems have about a 2 percent margin – we are slightly better than that – which makes it very difficult for a system to scale and grow, adding that there is “significant competition” for capital.
“It’s hard for a system to pay for a new chiller, or to do a roof replacement” when its “core business” is providing clinical care and doing research, Mr. Volas noted.
“So, we made the decision, after a lot of work, to go through with this monetization… And, if anyone thought we were selling our future, we really were not, as there hasn’t been any issues with our providing of the excellent patient care we’re known for. I’m excited about it. I think the proof-of-concept was there and it has worked out really well.”
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