Federal MOB Portfolio Receives $703M Financing

Gantry arranged a $373 million construction loan and $330 million permanent loan for six medical clinics that will be built in three states.
Department of Veterans Affairs medical clinic in New Port Richey, Fla. Image courtesy of Gantry

A six-building medical office portfolio—leased by the U.S. government and consisting of Department of Veterans Affairs medical clinics that will be developed in three states—has received $373 million in construction financing and $330 million in permanent financing arranged by Gantry Inc.

Working on an exclusive basis, Principal George Mitsanas and Senior Director Peter Hillakas, both located in the firm’s Los Angeles office, arranged the financing with a correspondent pension fund. Both the construction and permanent loans will also be serviced by San Francisco-based Gantry. Formerly known as Newmark Realty Capital, Gantry is the largest independent commercial mortgage banking firm in the U.S.


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Mitsanas said in a prepared statement that the financing vehicles provide maximum flexibility. While he did not provide details on the loans, Mitsanas said that Gantry will be the servicer on both until they mature in 22 years. He also noted they worked as a team with the first-time sponsor.

The medical clinics, scheduled to open in 2021, will be located in San Diego; Chula Vista, Calif.; Redding, Calif.; New Port Richey, Fla.; Tulsa, Okla.; and one undisclosed site.

Hillakas said in prepared remarks they were engaged before the leases were awarded, which helped them assess the feasibility of each project and develop a financing structure. He said that knowledge was helpful throughout the construction negotiation and financing process and resulted in their clients winning multiple leases from the U.S. government. Mitsanas noted the portfolio will generate thousands of construction and permanent jobs.

More Vet Clinic Deals

Last month, the Department of Veterans Affairs was among the tenants in six buildings in the Stafford Commerce Center and Stafford Commerce Park in Stafford, Va., that were part of an office portfolio that sold for $19.2 million. Newmark Knight Frank arranged the sale of the 272,000-square-foot office portfolio near Washington, D.C., for seller Hudson Real Estate Advisors to Next Tier Real Estate Investors.

In August, a Veterans Affairs clinic was among the tenants in the 38,194-square-foot Meharry Medical Arts Center in Nashville, Tenn., that was refinanced by owner Anchor Health Properties in a $7.6 million loan package originated by CIT Bank.

Last spring, Catalyst Capital purchased a medical office building in Lowell, Mass., that serves as a Veterans Affairs outpatient clinic, for $11.4 million from JACO Realty. The deal was arranged by NKF’s Boston Capital Markets team and its Chicago-based government properties team.