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Project Case Study: Big project in RTG’s hometown

Project Case Study: Big project in RTG’s hometown

By on May 25, 2023

UT Orthopaedic Institute in Knoxville, Tenn., achieves multiple goals

By John B. Mugford

Locally based Realty Trust Group (RTG) LLC, a longtime HRE firm, led the development of the soon-to-open UT Orthopaedic Institute across the road from the sprawling UT Medical Center campus in Knoxville, Tenn. The facility, which includes a 32,500 square foot ambulatory surgery center (ASC), is operated and occupied by a partnership of University Health Systems, University Orthopaedic Surgeons and OrthoTennessee. (Rendering courtesy of RTG)

In the healthcare real estate (HRE) sector, relationships matter.

A good example of this can be found in Knoxville, Tenn., home to the University of Tennessee (UT) and its 710-bed Medical Center (UTMC), an academic medical center that is part of University Health Systems and whose Graduate School of Medicine (UTGSM) oversees residency and medical student education.

For more than 20 years, a well-known local firm, Realty Trust Group (RTG), has had an ongoing relationship with the university’s health system, as well as locally based University Orthopaedic Surgeons and OrthoTennessee. RTG, which was founded in 1998 by President Greg Gheen and is focused on the HRE and life sciences real estate (LSRE) sectors, is based in Knoxville, and has offices in six other cities in Tennessee, North Carolina, Florida and Texas.

In recent years, as UTMC, University Orthopaedic Surgeons and OrthoTennessee began evaluating the feasibility of developing a new joint venture (JV) operated ambulatory surgery center (ASC), medical office building (MOB) and research facility to replace the Advanced Orthopaedic Center, RTG assisted and offered its HRE expertise.

After all, RTG has completed more than $2.4 billion worth of HRE transactions, including developments, and currently manages more than 16 million square feet of HRE space.

When the entities decided to move forward, they chose RTG as the developer through a competitive request for proposals (RFP) process.

Construction started in October 2020 and a ribbon cutting is planned in July 2022 for the new 91,000 square foot Orthopaedic Institute at 1600 Accelerator Way, which is in the University of Tennessee Research Park at Cherokee Farms. The new Orthopaedic Institute is just across Alcoa Highway from the sprawling, massive UT Medical Center campus. The medical center campus, as well as the research park, are on a thumb of land framed by the Tennessee River and are just across the river from UT’s main campus.

According to Chad Simpson, executive VP with RTG, and Mr. Gheen, RTG is involved in the ownership of the facility in a partnership with University Health Systems and OrthoTennessee, including physicians.

“The facility represents an ongoing partnership by University Orthopaedic Surgeons, OrthoTennessee and UT Medical Center to collaboratively meet the changing medical needs of the greater community in East Tennessee,” Mr. Simpson tells HREI™.

“The JV accomplishes several goals,” he adds. “First, UHS desired for continued alignment of interests with the physicians; and OrthoTennessee wanted all physicians across their organization to participate in the real estate ownership, and this project was an anchor project for a newly formed physician real estate ownership platform.”

The facility has been fully pre-leased since construction started, and it contains a 32,500 square foot ASC; a walk-in orthopedic urgent care center; an after-hours injury clinic; an imaging center; physical therapy; and, on the top floor, 17,000 square feet of space for orthopedic and other medical research, which, according to UT Medical Center, is “the ideal fit for the mission of the research park.”

Preparing for the project

During the feasibility phase of preparing for such a project, RTG helped assess and find the right site.

According to Mr. Simpson, the key drivers for the chosen location include that it is in UT Research Park, which is “highly visible to the community.” It is also part of a destination for those traveling to UT Medical Center and, because of its close proximity to the hospital, it is convenient for trauma surgeons. Also, the facility’s ownership partnership was able to enter a ground lease for the land, which is controlled by UT.

“The research park where the orthopedic institute is located consists of 16 building sites, seeding partnerships with nationally recognized companies and entrepreneurs and start-ups,” Mr. Simpson notes. “Investments in the park are being made in material sciences, advanced manufacturing research and life sciences.”

Building the new orthopedics institute so close to the UT Medical Center also allowed for the relocation of the University Orthopedic Surgeons’ clinic from the main campus at UT Medical Center and into the new facility, freeing up inpatient surgical capacity for orthopedics and other specialties in the main hospital while also moving outpatient cases and surgeries to a “lower-cost setting,” according to Mr. Simpson. “This project also allowed the physicians to consolidate and expand their clinic, physical therapy and imaging space into one location.

“Because of the location, UTMC considers the project to be an on-campus one, given the easy access and connectivity for physicians back and forth to the hospital.”

The first floor of the three-story building serves as the ASC, which includes five operating rooms (ORs) – with an expansion to seven ORs planned for the future – three procedure rooms and an advanced imaging center.

Among the services and procedures to be offered in the facility are: sports medicine; shoulder and elbow; hand and wrist; minimally invasive carpal tunnel surgery; in-office, simple hand procedures; foot and ankle; outpatient joint replacement surgeries; and orthopedic oncology.

“The project was delayed for two months during the pandemic,” Mr. Simpson notes. “However, both organizations decided it was the right project at the right time given various needs in the community and organizational strategic goals. We were able to start construction on the project in October 2020 and were able to re-bid and save significant dollars during the ‘soft spot’ in construction pricing as the market was re-setting itself.

“As the project comes to a completion, we’ve been able to overcome several supply-chain challenges to open the building as scheduled and on-budget.”

So far, “the feedback from physicians has been overwhelmingly positive,” Mr. Simpson says. “Some of the most pronounced feedback has been around the quality of the facility and the ease of access to be provided for patients to services in one location. The University of Tennessee collaboration also continues to strengthen on the research side as well.”

“This new facility is designed to provide comprehensive orthopedic excellence to meet the changing needs of this community for years to come” said Jon-David Deeson, CEO of OrthoTennessee, in a news release. “Every part of this project was intentionally planned to improve the patient experience and reduce cost of care without compromising our commitment to provide the best care possible.

“The team at RTG did an outstanding job working with our design and construction partners to help bring our vision to reality. This is the only facility of its kind in the region, and we are thrilled to make this resource available to our patients.” 

Update: UT Orthopaedic Institute, which officially opened July 14, 2022, was delivered on time and 7 percent under budget. The building is 100 percent occupied on 15-year leases with long-term fixed-rate financing of less than 3 percent. The project was named a Finalist (Best New Medical Office Buildings and Other Outpatient Facilities (50,000 to 99,999 square feet) in the 2022 HREI Insights Awards, which recognize excellence in HRE development and executive leadership.

University of Tennessee (UT) Orthopaedic Institute
1600 Accelerator Way, Knoxville, Tenn.

STATS
■ Project cost: $37.6 million
■ Project Size: Three stories, 91,354 square feet
■ Location: UT Research Park at Cherokee Farms
■ Start of construction: October 2020
■ Opening: July 2022
■ Contains: ASC, urgent care center, physician offices, research space, underground parking
■ Occupancy: 100 percent

PLAYERS
■ Developer/co-owner: Realty Trust Group
■ Client: University Health Systems, University Orthopaedic Surgeons and OrthoTennessee
■ Designer: BarberMcMurry Architects
■ Contractor: Christman Company
■ Leasing/property management: Realty Trust Group

News Release: Realty Trust Group Celebrates Opening of UT Medical Center’s Advanced Orthopaedic Institute

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News Release: Just Financed. Seven-Story Medical Office and Biomedical Building in Downtown Grand Rapids, MI

By on May 24, 2023

Doug Meijer Medical Innovation Building

109 Michigan St. NW | Grand Rapids, MI 49503

Berkadia Medical and Life Sciences secured a non-recourse permanent loan at 65% LTV for the Doug Meijer Medical Innovation Building in downtown Grand Rapids, Michigan. The Sponsor is a JV between Harrison Street, Walsh Construction, Murphy Development, and Rockford Construction.

Harrison Street is a leading investment management firm exclusively focused on alternative real assets. Headquartered in Chicago with offices in London, New York, Tokyo, Toronto, San Francisco, and Washington D.C., the Firm has more than 250 employees and over $55 billion in assets under management.

The Property is a new Class A, seven-story medical office and biomedical building consisting of 205,534 square feet of NRA. The building features a synergistic medical tenant mix of 37% investment grade health systems and universities, BAMF Health providing advanced imaging technology and cancer treatments and a university-affiliated healthcare innovation space on the fourth floor. The Property also includes an on-site 598 space parking garage.

Located in downtown Grand Rapids along the “Medical Mile,” the Property is conveniently located adjacent to the MSU Medical School and just over a quarter of a mile west of the Corewell Health (formerly Spectrum Butterworth) Hospital.

For more information, or to learn more about Berkadia Medical and Life Sciences, please contact us.

LEARN MORE

SABRINA SOLOMIANY
Senior Managing Director
Medical & Life Sciences
404.536.5054
Email me

MIKE CERNY
Vice President
Medical & Life Sciences
904.296.7565
Email me

CHRISTOPHER MEYER
Analyst
Medical & Life Sciences
404.654.2341
Email me

MORTGAGE BANKING

RICHARD LEVINE
Senior Managing Director
404.654.2590
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News Release: McCarthy Completes Houston Methodist Sugar Land Medical Office Building

By on May 24, 2023

HOUSTON – May 24, 2023 – McCarthy Building Companies, Inc. has completed construction of two structures on the campus of Houston Methodist Sugar Land Hospital located in the greater Houston area. The project included a six-story medical office building and an attached seven-level parking garage. McCarthy broke ground in December 2021.

McCarthy’s scope included a medical office building, totaling 160,000 square feet, while the garage consists of 1,100 spaces. Conditioned pedestrian bridges connect the new medical office building to the existing campus buildings. A vehicle bridge connects the new garage to an existing adjacent garage. For the building’s interior, McCarthy was responsible for building out the lobby, corridors, and an endoscopy surgical center. The surgical center, which will be completed in August, includes three endoscopy rooms as well as one operating room.

The project’s location within the campus also created multiple challenges, as working within an operating hospital campus meant McCarthy had to work in a confined area without disrupting sensitive hospital operations. Deliveries were timed to ensure materials were installed as soon as possible to accommodate limited laydown space. Challenges associated with the supply chain were managed to ensure materials arrived in time to prevent disrupting the project schedule.

As part of the project, McCarthy undertook a major logistical challenge of extending a water main 2,500 feet around the campus while navigating existing underground utilities. Additionally, the existing garage structure was reinforced to accommodate the new vehicle connector bridge. On the technology front, McCarthy utilized a fully BIM-coordinated MEP system, as well as using McCarthy Mapping to identify locations of underground utilities.

“With an aggressive timeline and several challenges along the way, the entire project team was unified in its commitment to serve Houston Methodist and provide a seamless experience on this complex project,” said Greg Lynch, McCarthy project director. “We always want to be good stewards of each project, and McCarthy was honored to continue our partnership with Houston Methodist as they expand in Sugar Land.”

McCarthy served as the project construction manager, with Page as the project architect and Jacobs as the Owner’s representative. With an extensive portfolio of multi-phase healthcare and research facility projects, McCarthy is ideally suited to take on healthcare and research projects of any size or complexity. Some of McCarthy’s other healthcare projects include Houston Methodist Cypress Hospital, Texas Children’s Hospital – Austin, Parkland Moody Center for Breast Health in Dallas, CHRISTUS Mother Frances Hospital – Tyler expansion, CHRISTUS Spohn in Corpus Christi, The University of Texas MD Anderson Cancer Center Alkek Hospital Expansion and The University of Texas MD Anderson Cancer Center The Pavilion expansion.

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About McCarthy

McCarthy Building Companies, Inc. is the oldest privately held national construction company in the country – with more than 150 years spent collaborating with partners to solve complex building challenges on behalf of its clients. With an unrelenting focus on safety and a comprehensive quality program that spans all phases of every project, McCarthy utilizes industry-leading design phase and construction techniques combined with value-add technology to maximize outcomes. Repeatedly honored as a Best Place to Work and Healthiest Employer, McCarthy is ranked the 19th largest domestic builder (Engineering News-Record, 2022). With approximately 5,000 salaried employees and craft professionals, the firm has offices in St. Louis, Atlanta; Collinsville, Ill.; Kansas City, Kan.; Omaha, Neb.; Phoenix; Las Vegas; Denver; Dallas, Houston; and San Diego, Newport Beach, San Francisco, San Jose and Sacramento, Calif. McCarthy is 100 percent employee owned. More information about the company is available online at www.mccarthy.com or by following the company on Facebook, Twitter, LinkedIn and Instagram.

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News Release: Davis holds open house for 44,000-square-foot medical office building in Maple Grove, Minn.

By on May 24, 2023

News Release

The convenient, central location on Highway 610 is expected to benefit patients and tenants, including MNGI Digestive Health, which is occupying the entire second floor

An open house was held recently for the newly opened, 44,000-square-foot Maple Grove Specialty Center near Maple Grove Parkway in Maple Grove, Minn.

MAPLE GROVE and MINNEAPOLIS, Minn., May 24, 2023 – Minneapolis-based real estate developer Davis recently held an open house to celebrate the completion of the 44,000-square-foot, Class A Maple Grove Specialty Center in Maple Grove, Minn.

MNGI Digestive is the anchor tenant and occupies the entire 22,000-square-foot second floor of the building, according to
Mark Davis, Founder and Principal of the national healthcare real estate development, property management, brokerage and investment firm.

“We expect the new specialty center will really benefit MNGI, allowing it to better serve its growing patient base in the Northwest Twin Cities metro area,” Mr. Davis says.

“When we searched for a good location for MNGI, we found the ideal site in Maple Grove bordered by Highway 610 and Maple Grove Parkway. It’s a highly visible site that will be convenient for building tenants and their patients. It’s also near a large number of retail establishments and in a growing medical hub near the Maple Grove Hospital.”

Maple Grove Specialty Center will also be home to Minnesota Oncology, which leased the entire first floor of the building, which brings the building to 100% occupancy.

“The area also boasts excellent demographics,” he adds. “Within five miles of the facility, there was a 2020 estimated population of more than 94,000, and the average estimated household income was more than $131,000.”

The Maple Grove Specialty Center occupies 4.2 acres on the southern end of the 8.13-acre site. Future plans are for retail stores and offices to occupy the northern portion of the property. In addition to developing the specialty center, Davis owns the building and provides property management and leasing services to tenants.

The architect for the project was Minneapolis-based Synergy Architecture Studio, and the general contractor was Timco Construction Inc., which is headquartered in Plymouth, Minn.

About Davis

Davis, founded in 1986, is a national healthcare real estate firm that offers unparalleled expertise in healthcare real estate development, property management, brokerage, investment and consulting services to health systems, hospitals, individual medical groups, specialty practices and other healthcare organizations. The company has developed 36 Class A medical buildings totaling $444-plus million in development costs and completed 57 investment transactions totaling more than $726 million. For more information, please visit www.davishre.com.

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News Media Contact:
Vickie Ridgley, 612-383-2717, vridgley@davishre.com

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News Release: Medical Properties Trust Announces Closing of Sale of Seven Australian Hospitals

By on May 24, 2023

BIRMINGHAM, Ala., May 24, 2023 –(BUSINESS WIRE)–Medical Properties Trust, Inc. (the “Company” or “MPT”) (NYSE: MPW) today announced that it has completed, as expected, the sale of seven Australian hospitals for AUD$730 million, with proceeds used to reduce its Australian term loan. MPT additionally settled the pro rata portion of its interest rate swap for a gain of AUD$20 million. The Company expects to close the remaining AUD$470 million in property sales and debt repayment during the current quarter. The 5.7% cap rate implied in the AUD$1.2 billion valuation of MPT’s Australian portfolio provides a strong read-through for similar assets in the Company’s U.S. and Western Europe portfolios.

About Medical Properties Trust, Inc.

Medical Properties Trust, Inc. is a self-advised real estate investment trust formed in 2003 to acquire and develop net-leased hospital facilities. From its inception in Birmingham, Alabama, the Company has grown to become one of the world’s largest owners of hospital real estate with 436 facilities and approximately 44,000 licensed beds in ten countries and across four continents. MPT’s financing model facilitates acquisitions and recapitalizations and allows operators of hospitals to unlock the value of their real estate assets to fund facility improvements, technology upgrades and other investments in operations. For more information, please visit the Company’s website at www.medicalpropertiestrust.com.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “would”, “could”, “expect”, “intend”, “plan”, “estimate”, “target”, “anticipate”, “believe”, “objectives”, “outlook”, “guidance” or other similar words, and include statements regarding our strategies, objectives, future expansion and development activities, and expected financial performance. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results or future events to differ materially from those expressed in or underlying such forward-looking statements, including, but not limited to: (i) the economic, political and social impact of, and uncertainty relating to, potential impact from health crises (like COVID-19); (ii) the ability of our tenants, operators and borrowers to satisfy their obligations under their respective contractual arrangements with us, especially as a result of the adverse economic impact of the COVID-19 pandemic, and government regulation of hospitals and healthcare providers in connection with same (as further detailed in our Current Report on Form 8-K filed with the SEC on April 8, 2020); (iii) our expectations regarding annual guidance for net income and NFFO per share; (iv) our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate acquisitions and investments; (v) the nature and extent of our current and future competition; (vi) macroeconomic conditions, such as a disruption of or lack of access to the capital markets or movements in currency exchange rates; (vii) our ability to obtain debt financing on attractive terms or at all, which may adversely impact our ability to pursue acquisition and development opportunities and pay down, refinance, restructure or extend our indebtedness as it becomes due; (viii) increases in our borrowing costs as a result of changes in interest rates and other factors; (ix) international, national and local economic, real estate and other market conditions, which may negatively impact, among other things, the financial condition of our tenants, lenders and institutions that hold our cash balances, and may expose us to increased risks of default by these parties; (x) factors affecting the real estate industry generally or the healthcare real estate industry in particular; (xi) our ability to maintain our status as a REIT for federal and state income tax purposes; (xii) federal and state healthcare and other regulatory requirements, as well as those in the foreign jurisdictions where we own properties; (xiii) the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain equity or debt financing secured by our properties or on an unsecured basis; (xiv) the ability of our tenants and operators to operate profitably and generate positive cash flow, comply with applicable laws, rules and regulations in the operation of the our properties, to deliver high-quality services, to attract and retain qualified personnel and to attract patients; (xv) potential environmental contingencies and other liabilities; (xvi) the risk that the expected sale of three Connecticut hospitals currently leased to Prospect does not occur; (xvii) the risk that MPT’s expected sale of its Australian portfolio does not occur; (xviii) the risk that other property sales, loan repayments, and other capital recycling transactions do not occur; and (xix) the risks and uncertainties of litigation.

The risks described above are not exhaustive and additional factors could adversely affect our business and financial performance, including the risk factors discussed under the section captioned “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 and as updated in our quarterly reports on Form 10-Q. Forward-looking statements are inherently uncertain and actual performance or outcomes may vary materially from any forward-looking statements and the assumptions on which those statements are based. Readers are cautioned to not place undue reliance on forward-looking statements as predictions of future events. We disclaim any responsibility to update such forward-looking statements, which speak only as of the date on which they were made.

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News Release: Physicians Realty Trust Announces $400 Million Five-Year Term Loan

By on May 24, 2023

MILWAUKEE, –(BUSINESS WIRE)–Physicians Realty Trust (NYSE: DOC) (the “Company”) announced today that it has closed on a $400 Million Term Loan maturing May 2028 (the “Term Loan”).

Pursuant to the Company’s unsecured credit agreement, the Term Loan will bear interest at a rate equal to Adjusted Daily Simple SOFR plus a spread of between 0.85% and 1.65% that is determined based on the Company’s credit rating. Concurrent with closing, the Company executed $400 Million of variable-to-fixed interest rate swaps that fix the variable component of the Term Loan at 3.59% for the duration of the borrowing. Based on the Company’s current ‘BBB’ credit rating and inclusive of the effects of the related swaps, the Term Loan bears interest at a current rate of 4.69%.

A total of seven lenders are participating in the Term Loan. KeyBank National Association is acting as the Administrative Agent and a lender. BMO Harris Bank N.A. and Regions Bank are serving as Joint Lead Arrangers and lenders. Bank of America, N.A. and Credit Agricole Corporate and Investment Bank are serving as Documentation Agents and lenders. Raymond James Bank and Associated Bank, N.A. are participating as lenders.

“We appreciate our banking group and their strong support throughout the execution of this Term Loan. This transaction enhances our liquidity and financial flexibility by allowing us to term out our revolver which meaningfully reduces our exposure to floating rate debt and lowers interest expense. We are pleased our banking group recognizes the strong underlying real estate performance of DOC’s outpatient medical facilities, and we are well positioned to capitalize on investment opportunities as we strive to deliver value on behalf of our shareholders,” said Jeffrey N. Theiler, Executive Vice President and Chief Financial Officer.

About Physicians Realty Trust

Physicians Realty Trust is a self-managed health care real estate company organized to acquire, selectively develop, own, and manage outpatient medical properties that are leased to physicians, hospitals and health care delivery systems. The Company invests in real estate that is integral to providing high quality health care. The Company is a Maryland real estate investment trust and has elected to be taxed as a REIT for U.S. federal income tax purposes. The Company conducts its business through an UPREIT structure in which its properties are owned by the Operating Partnership, directly or through limited partnerships, limited liability companies or other subsidiaries.

Forward-Looking Statements

This press release contains statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “anticipate”, “believe”, “expect”, “estimate”, “plan”, “outlook”, “continue”, “intend”, and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward looking statements may include statements regarding the Company’s strategic and operational plans, the Company’s ability to generate internal and external growth, the future outlook, anticipated cash returns, cap rates or yields on properties, anticipated closing of property acquisitions, and ability to execute its business plan. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. These forward-looking statements are subject to various risks and uncertainties, not all of which are known to the Company and many of which are beyond the Company’s control, which could cause actual results to differ materially from such statements. These risks and uncertainties are described in greater detail in the Company’s filings with the Securities and Exchange Commission (the “Commission”), including, without limitation, the Company’s annual and periodic reports and other documents filed with the Commission. Unless legally required, the Company disclaims any obligation to update any forward-looking statements after the date of this release, whether as a result of new information, future events or otherwise. For a discussion of factors that could impact the Company’s results, performance, or transactions, see Part I, Item 1A (Risk Factors) of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

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News Release: Medical Properties Trust Announces Closing of Sale of Seven Australian Hospitals

By on May 24, 2023

BIRMINGHAM, Ala., May 24, 2023–(BUSINESS WIRE)–Medical Properties Trust, Inc. (the “Company” or “MPT”) (NYSE: MPW) today announced that it has completed, as expected, the sale of seven Australian hospitals for AUD$730 million, with proceeds used to reduce its Australian term loan. MPT additionally settled the pro rata portion of its interest rate swap for a gain of AUD$20 million. The Company expects to close the remaining AUD$470 million in property sales and debt repayment during the current quarter. The 5.7% cap rate implied in the AUD$1.2 billion valuation of MPT’s Australian portfolio provides a strong read-through for similar assets in the Company’s U.S. and Western Europe portfolios.

About Medical Properties Trust, Inc.

Medical Properties Trust, Inc. is a self-advised real estate investment trust formed in 2003 to acquire and develop net-leased hospital facilities. From its inception in Birmingham, Alabama, the Company has grown to become one of the world’s largest owners of hospital real estate with 436 facilities and approximately 44,000 licensed beds in ten countries and across four continents. MPT’s financing model facilitates acquisitions and recapitalizations and allows operators of hospitals to unlock the value of their real estate assets to fund facility improvements, technology upgrades and other investments in operations. For more information, please visit the Company’s website at www.medicalpropertiestrust.com.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “would”, “could”, “expect”, “intend”, “plan”, “estimate”, “target”, “anticipate”, “believe”, “objectives”, “outlook”, “guidance” or other similar words, and include statements regarding our strategies, objectives, future expansion and development activities, and expected financial performance. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results or future events to differ materially from those expressed in or underlying such forward-looking statements, including, but not limited to: (i) the economic, political and social impact of, and uncertainty relating to, potential impact from health crises (like COVID-19); (ii) the ability of our tenants, operators and borrowers to satisfy their obligations under their respective contractual arrangements with us, especially as a result of the adverse economic impact of the COVID-19 pandemic, and government regulation of hospitals and healthcare providers in connection with same (as further detailed in our Current Report on Form 8-K filed with the SEC on April 8, 2020); (iii) our expectations regarding annual guidance for net income and NFFO per share; (iv) our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate acquisitions and investments; (v) the nature and extent of our current and future competition; (vi) macroeconomic conditions, such as a disruption of or lack of access to the capital markets or movements in currency exchange rates; (vii) our ability to obtain debt financing on attractive terms or at all, which may adversely impact our ability to pursue acquisition and development opportunities and pay down, refinance, restructure or extend our indebtedness as it becomes due; (viii) increases in our borrowing costs as a result of changes in interest rates and other factors; (ix) international, national and local economic, real estate and other market conditions, which may negatively impact, among other things, the financial condition of our tenants, lenders and institutions that hold our cash balances, and may expose us to increased risks of default by these parties; (x) factors affecting the real estate industry generally or the healthcare real estate industry in particular; (xi) our ability to maintain our status as a REIT for federal and state income tax purposes; (xii) federal and state healthcare and other regulatory requirements, as well as those in the foreign jurisdictions where we own properties; (xiii) the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain equity or debt financing secured by our properties or on an unsecured basis; (xiv) the ability of our tenants and operators to operate profitably and generate positive cash flow, comply with applicable laws, rules and regulations in the operation of the our properties, to deliver high-quality services, to attract and retain qualified personnel and to attract patients; (xv) potential environmental contingencies and other liabilities; (xvi) the risk that the expected sale of three Connecticut hospitals currently leased to Prospect does not occur; (xvii) the risk that MPT’s expected sale of its Australian portfolio does not occur; (xviii) the risk that other property sales, loan repayments, and other capital recycling transactions do not occur; and (xix) the risks and uncertainties of litigation.

The risks described above are not exhaustive and additional factors could adversely affect our business and financial performance, including the risk factors discussed under the section captioned “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 and as updated in our quarterly reports on Form 10-Q. Forward-looking statements are inherently uncertain and actual performance or outcomes may vary materially from any forward-looking statements and the assumptions on which those statements are based. Readers are cautioned to not place undue reliance on forward-looking statements as predictions of future events. We disclaim any responsibility to update such forward-looking statements, which speak only as of the date on which they were made.

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News Release: NexCore Group Breaks Ground on the Hunt Regional Healthcare Specialty Hospital and Medical Office Building in Royse City, Texas

By on May 23, 2023

May 23, 2023

The state-of-the-art specialty hospital and emergency room facility will expand healthcare access to a rapidly growing community east of Dallas

Today, NexCore Group, a national healthcare, life sciences, and seniors housing real estate developer, announced they broke ground on the new Hunt Regional Healthcare Medical Office Building (MOB) in Royse City, Texas. With an opening date anticipated in the Fall of 2024, the facility will bring a full spectrum of physician care to the Royse City community.

The Hunt Regional Healthcare MOB will house a state-of-the-art emergency facility that offers a full spectrum of physician care, including five in-patient beds, 10-bay emergency specialty hospital, diagnostic imaging, laboratory services, primary care, and various specialty practices, such as Women’s Care and Orthopedics. NexCore Group is partnering with Hill & Wilkinson General Contractors and architect Page Southerland Page to develop the two-story 70,000 SF facility, which will be located off I-30 and Shaw Road, east of FM 2642.

“We are pleased to help Hunt Regional further its mission to provide high-quality, service-oriented healthcare to the people in this community,” said Nathan Golik, Executive Vice President of Real Estate Development. “Our goal is to create a facility that meets those healthcare needs both now, and in the future, with the building’s surgical expansion capabilities to allow the array of services offered to grow with the community.”

The Hunt Regional Healthcare MOB will bring together a variety of high-quality physicians and surgeons in one convenient location, enabling community members to access integrated services in one place. “We are excited for the community of Royse City to experience firsthand that patient-first approach that our staff takes with every single interaction through this facility,” stated Travis Potter, Hunt Regional Healthcare Vice President of Business Development Administration. Patients will experience greater quality of care through the centralization of providers and services, while physicians will reap the benefits of enhanced efficiencies.

“At NexCore, we take pride in working with and listening to providers and community members to develop spaces that serve their unique needs,” added Todd Varney, Chief Development Officer and Managing Partner of NexCore Group. “We are thrilled to be developing a state-of-the-art facility that improves healthcare access and experiences for patients and physicians alike.”

For a video of the ground break please visit: https://vimeo.com/nexcoregroup/huntroysecity

NexCore Group LLC is a national healthcare real estate investment and development company that focuses on acquiring, developing, owning, and managing purpose-built facilities for healthcare, science and technology, and seniors housing. Since its founding in 2004, NexCore has successfully completed over $5.7 billion in real estate transactions throughout 29 states, developed and acquired over 16 million square feet of healthcare, science, and senior living communities, and currently manages over $3.3 billion in assets spanning 7.6 million square feet. NexCore is headquartered in Denver, with regional offices in Bethesda, Charlotte, Dallas, Detroit, Houston, Indianapolis, Los Angeles, Orlando, Phoenix, and Seattle.

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News Release: Westover Hills Baptist Hospital Tops Out, Marking Midpoint of Construction

By on May 23, 2023

Press Release

05.25.23

Construction firm Robins & Morton topped out Westover Hills Baptist Hospital in San Antonio on May 23.

The topping out celebrates the installation of the final steel beam, completing the hospital’s structure and marking the official midpoint of construction.

Once complete in summer 2024, the five-story, 104-bed hospital will span 255,000 square feet and feature emergency, imaging, lab, obstetric, surgical and inpatient services. There will also be space designated for administrative and support departments. All patient rooms will be located on the second through fourth floors and the facility’s infrastructure will be capable of supporting an additional two floors for future growth.

The hospital was designed by architect ESa and Robins & Morton is managing the construction.

Robins & Morton is also building a 90,000-square-foot medical office building on the campus, which will be completed in spring 2024.

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News Release: New Rehabilitation Hospital Opens in Indianapolis

By on May 23, 2023

Indianapolis, IND. (05/23/2023):

Capital Growth Medvest is pleased to announce the completion of Community Health Network’s new inpatient rehabilitation hospital in Brownsburg, Indiana. The new facility is a partnership with Community Health Services and Lifepoint – Kindred. The joint venture represents their third rehabilitation hospital in the Indianapolis metro area.

The new 55,700-square-foot specialty inpatient hospital with all-private rooms will focus on patients who suffer from stroke, traumatic brain injury, spinal cord inputs, complex neurological disorders, orthopedic conditions, multiple trauma, amputation, and other injuries or disorders.

The two-story rehabilitation hospital features advanced multidisciplinary gyms, cooking therapy, cafeteria, and a courtyard to help patients return to daily living activities. A specialty brain injury unit includes monitored rooms, specialized beds and separate dining area to aid and support patients in their transition to daily activities.

“This partnership and this new hospital illustrate our commitment to enhancing health and well-being in the communities we serve,” Community Chief Operating Officer Jason Fahrlander said. “We are thrilled that the same life-changing, patient-focused rehabilitation services we offer at our north and south hospitals will now be convenient and accessible to patients who live west of Indianapolis.”

The completion of this project represents the fifth rehabilitation hospital developed by Medvest for a Kindred joint-venture. The hospital looks to employ 120 people. Earl Swensson Associates, Inc, a recognized leader among healthcare architecture firms, was the project’s designer. Turner Construction Indianapolis office was the project’s general contractor.

About Capital Growth Medvest

Capital Growth Medvest, based in Birmingham, Ala., helps medical facilities operate efficiently through real estate development and funding support. Its founders have completed well over $1 billion in healthcare developments and acquisitions, giving them the experience to find solutions to the most complex needs. Today, it delivers the knowledge, relationships and resources to help reach an organization’s goals. Visit us at medvest.com.

Comments or Questions:
Joe Baugh: (205) 969-7140

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News Release: Bergman Real Estate Group Announces New Long-Term Lease at 500 College Road East in Princeton

By on May 23, 2023

Accurant Biotech signs 27,000 sq. ft. in recently renovated office center

PRINCETON, N.J. (May 23, 2023) — Bergman Real Estate Group, a full-service real estate company based in Woodbridge, New Jersey, announced that the life sciences company, Accurant Biotech, Inc. has signed a 10-year lease for 26,566 feet of office space at 500 College Road East in Princeton, New Jersey. Move-in is slated for August 2023.

“We are thrilled that Accurant Biotech, Inc. has joined our prestigious tenant roster at 500 College Road East,” said Michael Bergman, president and CEO of Bergman Real Estate Group. “This is a significant lease transaction in the Princeton area, and is the direct result of our recent capital improvement program, new building services, and the scarcity of lab space.”

“Our relocation to 500 College Road, with its extensive amenities offered and prestige of the location provides us the opportunity to expand and modernize our workspace, attract and retain the best talent and continue to provide the innovation our firm is known for,” said Dongbei Li, Accurant’s Co-Founder and US Site Head.

According to Vinny Di Meglio and Erin Moran of JLL, the exclusive leasing agents for 500 College Road East,, Accurant Biotech is expanding into Princeton from its current East Windsor, New Jersey location.

“They love the cache of having a Princeton address and at the same time and they wanted to be in a building that offers a wide array of amenities that they could provide to their staff, thanks to Bergman’s recent $4 million capital improvement,” said Vinny Di Meglio. “When it comes to attracting new tenants, amenities are vital for recruitment.”

Major life sciences and pharmaceutical companies call Princeton home, and the city is within the jurisdiction of the Central New Jersey private, non-profit economic development initiative Einstein’s Alley, which focuses on R&D and knowledge-based jobs.

500 College Road East is a four-story, 160,000-square-foot office building that Bergman Real Estate Group, in a joint venture with Hornig Capital Partners, acquired in 2021. The building’s renovations included new amenities such as an advanced fitness center with showers and locker rooms, a shared conference center, an expanded full-service café, a game room with shuffleboard and billiards tables, and a bike share program. Rooftop solar panels were installed, and electric vehicle charging stations are soon to come.

The building is located within the Princeton Forrestal Center, located at the interchange of College Road East and U.S. Route 1. This 2,200-acre master-planned, mixed-use development community is home to nearly 200 businesses and several mixed-used venues such as hotels, conference centers, dining, research, office, academic, residential, and retail facilities, alongside 700 acres of preserved open space.

“Accurant Biotech’s expansion to 500 College Road East is a reminder that modern businesses are prioritizing office spaces with advanced services and amenities that provide an inspiring work environment, which improves employee morale and recruiting efforts,” Bergman said. “We expect additional interest in the property from leading firms in life sciences, computer technology, pharmaceutical, finance, and other sectors in which employees and employers alike demand the high-quality facilities available at 500 College Road East.”

As of the Accurant Biotech, Inc. lease signing, 500 College Road East is 70% leased, with the remaining leasing opportunities ranging from smaller spaces of 2,500 square feet to larger spaces of 12,000 square feet. Prospective brokers and tenants can contact Erin Moran, Vinny Di Meglio, or JLL at (609) 454-5242 or via www.BergmanRealty.com.

About Bergman Real Estate Group

Bergman Real Estate Group is a privately owned, full-service real estate investment and management company. With 33 years of history operating in New Jersey and other select markets, Bergman has earned a solid reputation as a reputable and trustworthy owner/manager. The company’s fully integrated platform includes acquisition, ownership, asset and property management, leasing and construction supervision. Bergman, which has built its success on acquiring and successfully repositioning underperforming properties, currently owns and manages 22 office buildings comprising 2.25 million square feet.

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Feature Story: Same underwriting, new ‘math’

By on May 23, 2023

Inflation, interest rates and the bid-ask gap have slowed HRE lending

By John B. Mugford

Changes to economic conditions and the healthcare real estate (HRE) market are what are driving a decline in loan volume, according to a recent panel discussion of HRE lenders. (Photo courtesy of BOMA)

If healthcare real estate (HRE) loan volume has declined in recent months, lenders say, don’t blame them.

The real culprits, they say, are rising inflation and higher interest rates, as well as the gap between seller expectations and what buyers are willing (and able) to pay. Although underwriting standards are similar, they say, those other issues have “changed the math” for HRE lending, resulting in fewer opportunities, fewer asset sales and, consequently, fewer loans.

That was according to a group of the HRE industry’s top lenders who gathered at the recent 2023 BOMA International Medical Office Buildings (MOBs) + Healthcare Real Estate Conference in Chicago.

“Our underwriting standards have stayed very similar, so we haven’t really changed a lot in that regard, and our risk tolerance is about the same as it’s always been,” Erik Tellefson, senior managing director with a healthcare-focused team at McLean, Va.-based Capital One (NYSE: COF), told the BOMA audience.

“I would say that the primary change is Continue reading “Feature Story: Same underwriting, new ‘math’”

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News Release: Medical Properties Trust Announces Prospect Recapitalization Transactions

By on May 23, 2023

Third-Party Lenders Invest $375 Million in Prospect

Proceeds Fully Repay Prospect’s ABL Facility

BIRMINGHAM, Ala., –(BUSINESS WIRE)–Medical Properties Trust, Inc. (the “Company” or “MPT”) (NYSE: MPW) today announced that affiliates of Prospect Medical Holdings (“Prospect”) have completed $375 million in new financings from third-party lenders, the proceeds of which will be used to provide Prospect’s hospital operations with liquidity and capitalize its managed care business for continued growth and value creation in a vibrant market for such businesses.

Prospect’s $250 million asset-backed revolving credit facility has been repaid in full and as a result, the unencumbered borrowing base of government and commercial insurance accounts receivable will provide first lien security for the previously announced MPT delayed draw term loan of up to $75 million. Prospect is expected to be substantially free of material debt or lease obligations outside of those to MPT and this new third-party financing.

MPT continues to have strong conviction in the embedded value of the Prospect platform and has structured its master leases and security agreements to provide collateral value in addition to its real estate interests, including interests in the equity of Prospect’s managed care business. As of the end of the first quarter of 2023, MPT holds $1.6 billion in total assets related to Prospect that are expected to be reconstituted as follows:

  • An approximately $513 million investment in six leased California hospitals, subject to a master lease scheduled to resume partial rent payments in September and full rent payments at an 8.44% cash yield in March of 2024;
  • A $457 million investment in MPT’s Connecticut real estate which, as previously announced, Yale New Haven Health is expected to acquire in a transaction that is expected to close during 2023’s third quarter. MPT’s investment is expected to be fully recovered through cash proceeds of $355 million at closing and equity interests in Prospect’s managed care business valued at $103 million;
  • A first lien mortgage loan of $150 million and equity interests in the managed care business valued at $100 million, resulting from the transfer to Prospect of Pennsylvania real estate with a book value of $250 million;
  • Loans aggregating approximately $264 million and accrued rent and interest of approximately $56 million, along with the previously announced $50 million convertible loan to the managed care entities are expected to be recovered through equity interests in the managed care business.

The new loan agreements among Prospect, MPT and third-party lenders have terms of approximately three years. During this period, Prospect intends to further build the value of its managed care business and continue operational and financial improvements of its hospital operating business.

About Prospect Medical

Prospect Medical is a group of health care organizations that have led the transformation of health care for over 25 years. Prospect Medical creates value by accepting the insurance risk from health plans and aligning with providers via unique financial compensation models and by deploying multiple evidence-based medical management services. The result is high-quality, cost-effective care for its membership. The assets and operations are scalable and exportable to new markets. Prospect’s assets include:

  • Prospect Medical Group: Large family of Independent Physician Associations (“IPAs”) with over 6,500 independent physicians’ profitably managing approximately 500 thousand lives in the largest 5 Counties in California with new markets in Arizona and Texas.
  • Prospect Health Plan: An insurance company able to accept all of the insurance risk for any type of HMO insurance (Commercial, Medicaid, Medicare, Dual-eligible); and
  • Prospect Medical Systems: A full-service management services organization (“MSO”) with expertise in data-driven medical management and delivering high quality of care to members.

About Medical Properties Trust, Inc.

Medical Properties Trust, Inc. is a self-advised real estate investment trust formed in 2003 to acquire and develop net-leased hospital facilities. From its inception in Birmingham, Alabama, the Company has grown to become one of the world’s largest owners of hospital real estate with 443 facilities and approximately 45,000 licensed beds in ten countries and across four continents. MPT’s financing model facilitates acquisitions and recapitalizations and allows operators of hospitals to unlock the value of their real estate assets to fund facility improvements, technology upgrades and other investments in operations. For more information, please visit the Company’s website at www.medicalpropertiestrust.com.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “would”, “could”, “expect”, “intend”, “plan”, “estimate”, “target”, “anticipate”, “believe”, “objectives”, “outlook”, “guidance” or other similar words, and include statements regarding our strategies, objectives, future expansion and development activities, and expected financial performance. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results or future events to differ materially from those expressed in or underlying such forward-looking statements, including, but not limited to: (i) the economic, political and social impact of, and uncertainty relating to, potential impact from health crises (like COVID-19); (ii) the ability of our tenants, operators and borrowers to satisfy their obligations under their respective contractual arrangements with us, especially as a result of the adverse economic impact of the COVID-19 pandemic, and government regulation of hospitals and healthcare providers in connection with same (as further detailed in our Current Report on Form 8-K filed with the SEC on April 8, 2020); (iii) our expectations regarding annual guidance for net income and NFFO per share; (iv) our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate acquisitions and investments; (v) the nature and extent of our current and future competition; (vi) macroeconomic conditions, such as a disruption of or lack of access to the capital markets or movements in currency exchange rates; (vii) our ability to obtain debt financing on attractive terms or at all, which may adversely impact our ability to pursue acquisition and development opportunities and pay down, refinance, restructure or extend our indebtedness as it becomes due; (viii) increases in our borrowing costs as a result of changes in interest rates and other factors; (ix) international, national and local economic, real estate and other market conditions, which may negatively impact, among other things, the financial condition of our tenants, lenders and institutions that hold our cash balances, and may expose us to increased risks of default by these parties; (x) factors affecting the real estate industry generally or the healthcare real estate industry in particular; (xi) our ability to maintain our status as a REIT for federal and state income tax purposes; (xii) federal and state healthcare and other regulatory requirements, as well as those in the foreign jurisdictions where we own properties; (xiii) the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain equity or debt financing secured by our properties or on an unsecured basis; (xiv) the ability of our tenants and operators to operate profitably and generate positive cash flow, comply with applicable laws, rules and regulations in the operation of the our properties, to deliver high-quality services, to attract and retain qualified personnel and to attract patients; (xv) potential environmental contingencies and other liabilities; (xvi) the risk that the expected sale of three Connecticut hospitals currently leased to Prospect does not occur; (xvii) the risk that MPT’s expected sale of its Australian portfolio does not occur; (xviii) the risk that other property sales, loan repayments, and other capital recycling transactions do not occur; and (xix) the risks and uncertainties of litigation.

The risks described above are not exhaustive and additional factors could adversely affect our business and financial performance, including the risk factors discussed under the section captioned “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 and as updated in our quarterly reports on Form 10-Q. Forward-looking statements are inherently uncertain and actual performance or outcomes may vary materially from any forward-looking statements and the assumptions on which those statements are based. Readers are cautioned to not place undue reliance on forward-looking statements as predictions of future events. We disclaim any responsibility to update such forward-looking statements, which speak only as of the date on which they were made.

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News Release: Robins & Morton Completes CaroMont Regional Medical Center’s Critical Care Tower

By on May 22, 2023

Press Release

05.22.23

CaroMont Health Regional Medical Center Critical Care Tower InteriorConstruction firm Robins & Morton celebrated the completion of CaroMont Regional Medical Center’s new critical care tower in Gastonia, North Carolina, on May 4.

The new four-story, 176,811-square-foot vertical expansion added 78 additional patient rooms to the CaroMont Regional Medical Center campus. Each floor includes patient rooms, support space, staff space and dedicated family space.

“I’d like to give a special thank you to everyone who contributed to completing this important facility, from our Robins & Morton team members to our trade contractors and design partners,” Robins & Morton Division Manager Mike Bumgardner said. “We’re appreciative of CaroMont’s trust in us to deliver this project that will have a great impact on the community.”

Robins & Morton has been working on CaroMont campuses since 2013, completing six projects, with three currently underway.

Robins & Morton served as the general contractor and McMillan Pazdan Smith served as the architect.

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News Release: The Sanders Trust Breaks Ground on $48 Million Inpatient Rehabilitation Hospital

By on May 22, 2023

New 60,500-sq. ft. Facility Located in Florida

Birmingham, Ala. – The Sanders Trust, one of the nation’s leading healthcare real estate investment and development companies, is pleased to announce the recent groundbreaking for a new $48 million inpatient rehabilitation hospital, Northwest Florida Rehabilitation Hospital in Jacksonville, FL.

The Sanders Trust was selected as the developer of the 60,500-square-foot hospital, which will include 50 inpatient rehabilitation beds in all private rooms. The hospital will focus on acute rehabilitation for patients who suffer from stroke traumatic brain injury, spinal cord injury, complex neurological disorders, orthopedic conditions, multiple trauma, amputation and other injuries or disorders.

This facility will feature multidisciplinary therapy gymnasiums that are equipped with the latest therapeutic technologies, including augmented-reality balance training, therapy bionics and a full-body exoskeleton. Additionally, it will include a therapeutic courtyard with exterior amenities to support patient care and help patients return to daily living activities.

The rehabilitation hospital will be operated by Lifepoint Rehabilitation, a business unit of Lifepoint Health , a leader in community-based healthcare that serves patients and providers across the healthcare continuum.

“The Sanders Trust is honored to be chosen as the developer for this state-of-the-art rehabilitation hospital alongside other outstanding service providers,” states Rance Sanders, President and CEO of The Sanders Trust. “We are proud to be a part of a project that will bring hope and healing to the people in the Jacksonville area.”

Northwest Florida Rehabilitation Hospital will be located off Normandy Village Boulevard on Jacksonville’s west side. The Sanders Trust will work with the architectural firm Earl Swensson, headquartered in Nashville, TN, and general contractor JE Dunn Construction, headquartered in Kansas City, MO.

For more information about The Sanders Trust’s role in this development, please contact Krista Conlin at krista@kcprojects.net.

ABOUT THE SANDERS TRUST

The Sanders Trust develops and acquires medical office buildings, inpatient rehabilitation hospitals, specialty hospitals and other mission critical healthcare facilities nationwide. Headquartered in Birmingham, Alabama, The Sanders Trust has been a recognized leader in the investment community for healthcare clients since its inception in 1989 and has developed or acquired medical properties in 30 states. For more information on The Sanders Trust, visit www.SandersTrust.com.

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