Grubb & Ellis Healthcare REIT II Purchases Three Facilities for $28.05 Million

NewImageGrubb & Ellis Healthcare REIT II announced it has acquired three different buildings, the Yuma Skilled Nursing Facility in Yuma, Ariz., Hardy Oak Medical Building in San Antonio, and Lakewood Ranch Medical Office Building in Bradenton, Fla.

“The acquisition of these properties was attractive to Grubb & Ellis Healthcare REIT II due to their proximity to well-managed medical centers and their financial performance,” said Danny Prosky, president and chief operating officer of the REIT.  “Additionally, as a result of the Yuma acquisition, we were able to extend through 2026 the leases of five other skilled nursing facilities owned by the REIT that are operated by Kissito Healthcare, which also operates Yuma Skilled Nursing Facility.”

Currently going through a multi million dollar renovation, the Yuma facility (40,000 sq. ft) is a 143 bed skilled nursing facility that was originally built in 1964.  Expected to cost approximately $3.5 million, it’s being paid for by Kissito Healthcare, the operator of Yuma Skilled Nursing Facility, which has agreed to a new lease that will run through April 30, 2026 with two additional ten-year renewal options.  Kissito Healthcare is the same operator of the five skilled nursing facilities of the Virginia Skilled Nursing Facility Portfolio, which Grubb & Ellis Healthcare REIT II purchased in September 2010.

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Hardy Oak Medical Building is a three-story, multi-tenant medical office building consisting of approximately 42,000 square feet of space in San Antonio, Texas.  Built in 2003 on the campus of the South Texas Spine and Surgical Hospital, the facility is physically connected to the medical center, a surgical facility jointly owned by National Surgical Hospitals and various independent physician groups.  The 87-bed Methodist Stone Oak Hospital, a member of the Methodist Health System, is located adjacent to the Hardy Oak Medical Building.

Lakewood Ranch Medical Office Building is a Class A, three-story, multi-tenant medical office building consisting of approximately 58,000 square feet in Bradenton, Fla.  Built in 2003 on the campus of Lakewood Medical Center, the building is connected to the hospital via an enclosed walkway.  Currently 98 percent leased to multiple tenants, including Lakewood Medical Center, the facility provides a variety of medical services, including: pediatrics, diagnostics, imaging, plastic surgery, podiatry, cardiovascular care and family practice.

Yuma Skilled Nursing Facility was acquired from AFS Realty of Yuma, Inc., an unaffiliated third party represented by Daniel Brown of Creative Health Capital, LLC.  Grubb & Ellis Healthcare REIT II financed the acquisition using $9.0 million in borrowings under its line of credit with Bank of America and cash proceeds received from its offering.

Hardy Oak Medical Building was acquired from 18626 Hardy Oak Ltd., an unaffiliated third party that was represented by Mark Krenger of Travis Commercial Real Estate Services and Clint Parker of Grubb & Ellis Company.  The REIT financed the acquisition through a $5.25 million loan assumption and cash proceeds received from its offering.

Lakewood Ranch Medical Office Building was acquired from Lakewood Ranch MOB LLP, an unaffiliated third party represented by Steve Horn of Ian Black Real Estate and Greg Endsley of Madison Street Partners.  The REIT financed the acquisition using $13.8 million in borrowings under its line of credit with Bank of America, N.A.