Griffin-American Healthcare REIT IV Inc., a publicly registered non-traded real estate investment trust co-sponsored by American Healthcare Investors and Griffin Capital Company, has completed the purchase of 11 healthcare buildings in five states and a joint venture membership interest in Trilogy Investors LLC for a total purchase price of approximately $200.4 million during the fourth quarter of 2018.
“We had a very active fourth quarter, with more than $200 million in acquisitions that add significant value to the portfolio of Griffin-American Healthcare REIT IV,” said Stefan Oh, executive vice president of acquisitions for American Healthcare Investors and Griffin-American Healthcare REIT IV. “In fact, the entirety of 2018 was a busy one for acquisitions, as we completed the purchase of nearly $450 million of accretive healthcare investments throughout the country and have identified an additional $120.1 million in pending acquisitions that we are working to close.”
Griffin-American Healthcare REIT IV’s fourth quarter acquisitions include:
Michigan Assisted Living Facility Portfolio (first tranche) – Grand Rapids, Holland, Howell, Lansing and Wyoming, Michigan
The first tranche of Michigan Assisted Living Facility Portfolio consists of six buildings within five senior housing facilities totaling approximately 272,000 square feet and 302 units located throughout Michigan. The first tranche of the portfolio was acquired in a sale-leaseback transaction with the operator, Vista Springs Assisted Living, which will lease the properties through 2033 under an absolute net lease structure.
Modesto Medical Office Building – Modesto, California
Located on the campus of the 461-bed Doctors Medical Center, Modesto Medical Office Building was 92 percent leased at the time of acquisition and had an average remaining lease term of 9.5 years. Its principal tenant is First California Physicians Partners, which leases 81 percent of the property through 2030. The three-story, approximately 57,000-square-foot building is the only medical office building on the campus of Doctors Medical Center, the largest hospital in Stanislaus County.
Mill Creek Medical Office Building – Mill Creek, Washington
Mill Creek Medical Office building is a 100 percent leased, single-story medical office building comprised of approximately 22,000 square feet. The multi-tenant property is leased to five tenants under triple net lease structures that include annual rent escalators of between 2.5 percent and 3 percent. At the time of acquisition, the building enjoyed a remaining weighted average least term of 9.6 years.
Lawrenceville Medical Office Building II – Lawrenceville, Georgia
Adjacent to the campus of the 353-bed Gwinnett Medical Center – Lawrenceville, the two-story medical office building is 100 percent leased to multiple tenants with an average remaining weighted lease term of 7.2 years. The approximately 45,000-square-foot building has received substantial capital improvements totaling in excess of $2 million during the past two years.
Flemington Medical Office Building Portfolio – Flemington, New Jersey
Built in 1993 and 2002, the two-building Flemington Medical Office Building Portfolio totals approximately 49,000 square feet and has a weighted average remaining lease term of approximately 6.8 years. As of the date of acquisition, the portfolio was approximately 99 percent leased to 14 tenants, including Hunterdon Medical Center, the dominant healthcare provider in the region since the 1950’s. Collectively, Hunterdon and its affiliates lease approximately 50 percent of the portfolio’s rentable square footage.
Trilogy Joint Venture Interest
Griffin-American Healthcare REIT IV acquired a 6 percent interest in a joint venture that owns approximately 97 percent of Trilogy Investors, LLC, the parent company of Trilogy Health Services LLC. Trilogy is a leading owner-operator of purpose-built integrated senior healthcare campuses throughout the states of Indiana, Ohio, Michigan and Kentucky.
Griffin-American Healthcare REIT IV, which invests in medical office buildings, senior housing facilities and skilled nursing facilities, oversees a $914.8 million portfolio comprised of 69 properties totaling approximately 3.8 million square feet, as well as interest in a joint venture which owns or operates a portfolio of integrated senior health campuses and ancillary businesses.
The REIT launched its initial public offering in February 2016 and has raised approximately $610 million in investor equity as of the third quarter of 2018, according to Summit Investment Research. The offering is scheduled to close in February 2019.