Medical Properties Trust Transitions Adeptus Leases to UCHealth
December 07 2017 - 8:30AM
Business Wire
Investment Grade-Rated Market Leader Assumes
Master Lease for All 11 Colorado Emergency Facilities
Medical Properties Trust, Inc. (the “Company” or “MPT”) (NYSE:
MPW) today announced that UCHealth, an affiliate of University of
Colorado Hospital, has acquired all of the Colorado joint venture
interests, assuming the existing master lease of 11 MPT free
standing emergency facilities. The master lease was amended to
provide a new 15-year initial term effective January 1, 2018 with
three five-year renewal options, while retaining the annual
escalation provision of the increase in the consumer price index
with a 2% minimum. The amendments will not have a material impact
on future results of operations.
The strength of MPT’s master lease structure, together with
guarantees from investment grade-rated UCHealth and retention of
existing letters of credit, provide strong protections of MPT’s
future rental income. UCHealth currently has an Aa3 rating with
Stable outlook from Moody’s, AA- rating with Stable outlook from
Standard and Poor’s and AA- rating with Positive outlook from
Fitch.
“It is a testimony to MPT’s powerful underwriting that this
dominant leader in the Colorado hospital market was eager to
acquire 100% ownership of these facilities immediately after
confirmation of the Adeptus bankruptcy plan,” said Edward K. Aldag,
Jr., MPT’s Chairman, President and Chief Executive Officer. “This
transaction demonstrates UCHealth’s strong commitment to these
locations as a means to provide excellent care, close to home, for
patients. At the same time, Adeptus strengthens its financial
position with respect to its remaining MPT facilities and MPT adds
another important investment grade tenant to its portfolio.”
The 11 facilities that are now master leased to UCHealth
affiliates represent a gross investment of $58.6 million, and
UCHealth’s purchase of Adeptus’ JV interest reduces MPT’s exposure
to Adeptus to less than 4.0% of total pro forma gross assets.
UCHealth encompasses nine hospitals and employs more than 20,000
caregivers and staff throughout its health system. The
not-for-profit entity in 2016 had $6.4 billion in assets and $3.7
billion in revenues. In its 2017 Best Hospitals Honor Roll, U.S.
News & World Report ranked UCHealth’s University of Colorado
Hospital the 15th best hospital in the United States and number one
in Colorado. UCHealth’s 2017 Community Benefits Report contains
third party estimates that UCHealth had a $6.6 billion economic
impact in 2016 and attracted $494 million in research funding to
the UCHealth Anschutz Medical Campus, which is home to the
University of Colorado School of Medicine. UCHealth also provided
$647 million in community benefits including $259 million in
uncompensated care in fiscal year 2017.
About Medical Properties Trust, Inc.
Medical Properties Trust, Inc. is a self-advised real estate
investment trust formed to capitalize on the changing trends in
healthcare delivery by acquiring and developing net-leased
healthcare facilities. MPT’s financing model allows hospitals and
other healthcare facilities to unlock the value of their underlying
real estate in order to fund facility improvements, technology
upgrades, staff additions and new construction. Facilities include
acute care hospitals, inpatient rehabilitation hospitals, long-term
acute care hospitals, and other medical and surgical facilities.
For more information, please visit the Company’s website at
www.medicalpropertiestrust.com.
The statements in this press release that are forward looking
are based on current expectations and actual results or future
events may differ materially. Words such as "expects," "believes,"
"anticipates," "intends," "will," "should” and variations of such
words and similar expressions are intended to identify such
forward-looking statements. Forward-looking statements involve
known and unknown risks, uncertainties and other factors that may
cause the actual results of the Company or future events to differ
materially from those expressed in or underlying such
forward-looking statements, including without limitation: the
satisfaction of all conditions to, and the timely closing (if at
all) of pending transactions; the sale or re-lease of certain
Adeptus facilities; the amount of acquisitions of healthcare real
estate, if any; results from the potential sales, if any, of
assets; capital markets conditions; estimated leverage metrics; the
repayment of debt arrangements; statements concerning the
additional income to the Company as a result of ownership interests
in certain hospital operations and the timing of such income; the
payment of future dividends, if any; completion of additional debt
arrangements, and additional investments; national and
international economic, business, real estate and other market
conditions; the competitive environment in which the Company
operates; the execution of the Company's business plan; financing
risks; the Company's ability to maintain its status as a REIT for
income tax purposes; acquisition and development risks; potential
environmental and other liabilities; and other factors affecting
the real estate industry generally or healthcare real estate in
particular. For further discussion of the factors that could affect
outcomes, please refer to the "Risk factors" section of the
Company's Annual Report on Form 10-K for the year ended December
31, 2016 and as updated by the Company’s subsequently filed
Quarterly Reports on Form 10-Q and other SEC filings. Except as
otherwise required by the federal securities laws, the Company
undertakes no obligation to update the information in this press
release.
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version on businesswire.com: http://www.businesswire.com/news/home/20171207005329/en/
Medical Properties Trust, Inc.Tim Berryman, 205-969-3755Director
– Investor Relationstberryman@medicalpropertiestrust.com
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