Global Medical REIT to Buy 2 Hospitals in Sherman, TX
- May 25, 2017
Global Medical REIT Inc. has entered into a purchase agreement to acquire two medical facilities in Sherman, Texas, for an aggregate purchase price of $26 million. The Carrus Specialty Hospital, a physician-owned, post-acute care facility, and the Carrus Rehabilitation Hospital, an inpatient rehabilitation facility, have 81,352 combined square feet, including 17,529 square feet of shell space. The acquisition is expected to close by July.
The company intends to use funds from its revolving credit facility for the acquisition. The buyer has also pledged to provide a $2 million tenant improvement allowance and up to $5 million for facility expansion. The seller, SDB Partners LLC, currently leases the property located at 1810 W. U.S. Highway 82 to two affiliated tenants, Texoma Hospital Partners LLC and Carrus Rehabilitation Hospital LLC.
Upon the closing of the deal, Global Medical plans to enter into a new, 20-year triple-net lease with the seller, through a wholly-owned subsidiary of its operating partnership. SDB Partners LLC plans to then sublease the property to the current tenants. The initial rent will be based on a capitalization rate of 8.8 percent. Carrus Healthcare LLC, THP and Carrus Rehab intend to serve as guarantors of the lease on a joint and several basis.
David Young, Global Medical REIT’s CEO, mentioned that the company’s been working on several acquisition opportunities and that the recent deal in Sherman, Texas, comes with healthy rent coverage and an attractive cap rate.
Image courtesy of Carrus Hospitals