Capital One Provides $311M to Recap MOB Portfolio

The financial services company came through for the borrowers—an institutional investor and a joint venture between Kayne Anderson Real Estate Advisors and MB Real Estate Healthcare—arranging two loans for the recapitalization of 28 medical office buildings totaling 1.5 million square feet.
Erik Tellefson - Managing Director, Capital One
Erik Tellefson – Managing Director, Capital One

A 28-property medical office building portfolio has just been recapitalized to the tune of $311 million, and Capital One had more than a little to do with it. The financial services company’s healthcare division recently provided two loans to a partnership—consisting of an institutional investor and a joint venture between Kayne Anderson Real Estate Advisors and MB Real Estate Healthcare—for the 1.5 million-square-foot group of assets.

The healthcare sector continues to be popular among lenders, and the asset’s strong occupancy and the market’s solid fundamentals have determined Capital One to provide financing for the portfolio. The joint venture’s collection of MOBs, which spans 11 states, is 95 percent leased to a roster of 150 tenants. 

“Our goal was to provide common ground, allowing the institutional investor to enter the medical office building market while addressing the need of Kayne Anderson and MB Real Estate to recapitalize the portfolio,” Erik Tellefson, managing director for Capital One Healthcare. “We worked closely with all parties to provide a financing solution that served everyone’s interests.”

MOB Stays Hot

The MOB sub-sector is still high on the radar of lenders and investors alike. “As investor appetite for health care-related real estate has grown, medical office buildings have emerged as the most popular property type within the niche,” as noted in a report released in August by commercial real estate services firm CBRE Inc.

Capital One isn’t shy about giving its backing to premier MOB portfolios. Earlier this year, the company served as lead arranger and bookrunner for a $534.9 million loan to finance Starwood Property Trust’s acquisition of a 34-property MOB portfolio totaling 1.9 million square feet. In July, Capital One took on the role of joint lead arranger, sole bookrunner, and administrative agent for a $250 million loan to Healthcare Trust Inc. for the refinancing of a 29-property, 1.7 million-square-foot collection of MOBs. 

Image courtesy of Capital One