Company Announces Two Completed Acquisitions
and Five Executed Purchase Contracts for an Aggregate of $103.5
million
Global Medical REIT Inc. (NYSE:GMRE) (the “Company” or “GMR”), a
Maryland corporation engaged primarily in the acquisition of
licensed, state-of-the-art, purpose-built healthcare facilities and
the leasing of these facilities to leading clinical operators with
dominant market share, announced today that it closed two
acquisitions during the first quarter of 2017 and has executed five
purchase contracts, four of which were executed during the first
quarter of 2017 and are previously unannounced. In total, the
closed acquisitions and purchase contracts encompass nine buildings
for an aggregate purchase price of $103,455,000. Of the five
purchase contracts discussed herein, the December 30, 2016 purchase
contract for the Great Bend Regional Hospital (“GBRH”) was
previously announced on January 4, 2017. Upon the successful
closings of the acquisitions under purchase contract, GMR’s gross
investment in real estate will be approximately $310 million.
The closed acquisitions, discussed further below, include the
Geisinger imaging center and clinic in central Pennsylvania
(“Geisinger”) and the Southwest Florida Neurological &
Rehabilitation Associates (“SWFNA”) building in Cape Coral,
Florida. The five purchase contracts, also discussed further below,
are for the purchase of a portfolio of three properties occupied by
the Oklahoma Center for Orthopedic & Multi-Specialty Surgery
(“OCOM”) in Oklahoma City, Oklahoma; Las Cruces Orthopedic
Associates (“LCOA”) in Las Cruces, New Mexico; Thumb Butte Medical
Center, a two-story clinic in Prescott, Arizona (“Prescott”); and
the South Lake Heart & Vascular Institute in Clermont, Florida
(“SLHVI”), and GBRH.
Q1 2017 Closed Acquisition Highlight Table
Property City State
Purchase Price Square Feet
Cap Rate1
Geisinger Lewisburg PA $7,300,000
28,480 7.30% SWFNA Cape Coral FL
$7,250,000 25,814 7.33%
Q1* 2017 Executed
Purchase Contract Highlight Table Property
City State Purchase Price
Square Feet Cap Rate LCOA Las Cruces
NM $4,880,000 15,716 7.25% Prescott
Prescott AZ $4,500,000 12,000
8.08% SLHVI Clermont FL $5,225,000
18,152 7.00% GBRH* Great Bend KS
$24,500,000 58,000 8.75% OCOM Oklahoma City
OK $49,800,000 100,401 7.10%
* GBRH purchase contract was executed on December 30, 2016 and
was previously announced on January 4, 2017
David Young, GMR’s Chief Executive Officer, stated, “I am happy
to announce these acquisitions, which will add more than 258,000
square feet to our property portfolio once the acquisitions under
purchase contract are closed, which we expect will occur in the
first quarter. Following the expected closings, our gross
investment portfolio will exceed $310 million, encompassing
approximately 924,000 square feet of leasable space. With two
months still remaining in the first quarter, this gives us great
momentum as we push toward covering our dividend.”
Mr. Young continued, “I would also like to highlight the
diversity of these acquisitions, from a geographic perspective
along with the type of markets they serve. As we state at the
outset of all of our announcements, we focus on the acquisition of
properties that are leased to leading clinical operators with
dominant market share. In building our portfolio, we have shown
that these acquisition parameters apply in a wide variety of areas.
In some cases, where markets are highly competitive, we may choose
to add properties, such as “OCOM”, with relatively lower cap rates
than our overall corporate average when it serves our broader
strategy. At the same time, we have been able to balance our
overall portfolio with higher than average cap rate deals in less
competitive areas, such as our recently-announced “Great Bend”
acquisition, which carries a cap rate of 8.75%. We believe our
strategy results in a well-diversified property portfolio which
best positions us to build value for our shareholders over the long
term.”
Geisinger – Lewisburg, PA
On January 12, 2017 GMR closed the acquisition of a 28,480
square-foot clinic and imaging center, which is occupied by two
affiliates of the Geisinger Health System. The first tenant,
Geisinger Medical Center - Susquehanna Valley Imaging, occupies
17,265 square feet of space and provides imaging services including
ultrasound, breast cancer screening and diagnosis, bone
densitometry, computerized tomography (CT scan), digital
mammography, fluoroscopy, magnetic resonance imaging (MRI), and
x-ray. The second tenant, the Geisinger-Bucknell Center for Autism
& Development Medicine, occupies the remaining 11,215 square
feet of space.
SWFNA – Cape Coral, FL
On January 17, 2017 GMR closed the acquisition which includes a
25,814 square-foot medical office building located in Cape Coral,
Florida. The property was built in 2007 by the Sypert Institute,
Inc. (d.b.a. Southwest Florida Neurological Associates), which
entered into a 10-year triple-net lease with GMR upon the closing
of the transaction.
LCOA – Las Cruces, NM
The transaction includes a 15,716 square-foot, orthopedic and
imaging clinic in Las Cruces, New Mexico. Built in 1987 and
expanded in 2012, the center includes 20 exam rooms, an outpatient
procedure room, two digital x-ray machines and two Tesla MRI
scanners (open and closed). LCOA offers orthopedic, sports
medicine, and pain management care, including minimally invasive
surgery. Upon closing, LCOA will enter into a 12-year triple net
lease with GMR, including four 5-year options.
Prescott – Prescott, AZ
The transaction includes a 12,000 square-foot, two-tenant
clinic, with one tenant, Thumb Butte Medical Center, PLLC (TBMC),
occupying 8,000 square feet and the second tenant, Ali Askari, MD
PC (“Askari”), occupying the remaining 4,000 square feet. The first
floor of TBMC includes 30 exam rooms, 7 restrooms, a pharmacy,
waiting room, doctor offices, x-ray, and a medical assistant room.
The second floor of TBMC includes 8 exam rooms, a reception area, a
doctor’s office, a nuclear room and an echocardiography room. Upon
closing, both TBMC and Askari will have their respective leases
amended and restated as 10 year leases with two 7-year options.
SLHVI – Clermont, FL
With closing expected in February 2017, the SLHVI facility is an
18,152 square-foot clinic occupied by three separate tenants:
Orlando Health, South Lake, and Vascular Specialists of Central
Florida. Upon closing, the weighted average lease term will be 7.7
years, with two 5-year options collectively. The property, built in
2014, is used for cardiology, endocrinology, and vascular
diagnostic services and is located on the South Lake Hospital
Campus.
OCOM – Oklahoma City, OK
With closing expected in March 2017, OCOM consists of three
buildings, totaling 100,401 square feet, for an aggregate purchase
price of $49,500,000. The buildings are 100% leased and occupied by
the Oklahoma Center for Orthopedic & Multi-Specialty Surgery
(“OCOM”). The three buildings include a 69,881 square-foot surgical
hospital (the “Hospital”); a 20,434 square-foot physical therapy
center (the “PT Center,” together with the Hospital, “OCOM South”);
and a 10,086 square-foot outpatient ambulatory surgery center
(“OCOM North”). Upon closing of the acquisition of OCOM South, GMR
will assume the existing triple-net lease agreement, pursuant to
which OCOM South is leased from Cruse-Two L.L.C., an Oklahoma
limited liability company, to OCOM with a remaining initial lease
term expiring September 1, 2033, subject to three consecutive
five-year renewal options by the tenant. Upon closing of the
acquisition of OCOM North, GMR will assume the existing triple-net
lease agreement, pursuant to which OCOM North is leased from
Cruse-Six, L.L.C., an Oklahoma limited liability company, as
landlord to OCOM, as tenant, with a remaining initial lease term
expiring on July 31, 2022, subject to two consecutive five (5)-year
renewal options by the tenant.
Refer to the Company’s January 4, 2017 press release for a
description of GBRH.
About Global Medical REIT Inc.
Global Medical REIT Inc. is a Maryland corporation engaged
primarily in the acquisition of licensed, state-of-the-art,
purpose-built healthcare facilities and the leasing of these
facilities to leading clinical operators with dominant market
share. The Company intends to produce increasing, reliable rental
revenue by expanding its portfolio, and leasing its healthcare
facilities to market-leading operators under long-term triple-net
leases. The Company’s management team has significant healthcare,
real estate and public real estate investment trust (“REIT”)
experience and has long-established relationships with a wide range
of healthcare providers. The Company intends to elect to be taxed
as a REIT for U.S. federal income tax purposes commencing with its
taxable year ended December 31, 2016.
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 Exchange Act, 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”, and “project” and other similar
expressions that predict or indicate future events or trends or
that are not statements of historical matters. 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.
These statements relate to, among other things, the Company’s
expectations regarding the completion of the acquisitions described
in the press release on the terms and conditions described herein,
the expected closing dates of these acquisitions; and the expected
lease terms. 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 performance or results to differ materially from
those expressed in or suggested by the forward-looking statements.
These risks and uncertainties are described in greater detail in
the Company’s filings with the United States 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, whether as a result of new information, future events
or otherwise. The Company undertakes no obligation to update these
statements after the date of this release.
1 Cap rates calculated based on current lease terms and do
not give effect to future rent escalations.
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version on businesswire.com: http://www.businesswire.com/news/home/20170201005428/en/
Investor Relations CounselThe Equity Group Inc.Jeremy Hellman,
212-836-9626Senior Associatejhellman@equityny.comorAdam Prior,
212-836-9606Senior Vice Presidentaprior@equityny.com
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