Nuveen Global Cities REIT Buys Medical Office Portfolio for $300 Million
Nuveen Global Cities REIT Inc., a publicly registered non-traded real estate investment trust, has purchased a 10-building healthcare portfolio.
Nuveen Global Cities REIT Inc., a publicly registered non-traded real estate investment trust sponsored by Nuveen LLC, has purchased a 10-building medical office portfolio for approximately $300 million.
The 661,000-square-foot portfolio consists of newly constructed or newly renovated healthcare properties located in Atlanta, Pittsburgh, Tampa, and Dallas that were 96 percent leased at the time of acquisition by 57 tenants. The portfolio has in-place average annual escalations of more than 2.5 percent and a 5.7 year weighted average lease term.
The company said that tenant demand for space in these assets is “robust,” and since May 2022, approximately 65,000 square feet of new and renewal leases have been signed or are in progress.
“This portfolio is in line with [Nuveen Global Cities REIT’s] goal to acquire high-quality, recession-resilient healthcare assets in select target markets. These buildings are leased to best-in-class healthcare providers that are significantly invested in their space, with nine of the ten assets featuring tenants with imaging, surgical and/or oncology buildouts,” said Richard Kimble, co-president and lead portfolio manager.
The portfolio is part of the REIT’s strategy to increase exposure to the healthcare sector in target U.S. cities and will increase the REIT’s allocation in the sector to 21 percent.
Nuveen Global Cities REIT, which oversees a $2.5 billion portfolio, launched its initial offering in January 2018 and raised $394.4 million in investor equity before closing in July 2021. Its $5 billion follow-on offering has raised nearly $1.3 billion, as of mid-August 2022.
