Real Estate Investment Trust Completes $160 Million Sale of Eight Arizona Facilities to Dignity Health

inbusinessPHX.com

Medical Properties Trust, Inc. announced the sale of the 50-bed Arizona General Hospital in Mesa and seven freestanding emergency department (“FSED”) facilities in the Phoenix metropolitan area to Dignity Health, a wholly-owned subsidiary of CommonSpirit Health, for $160 million. The sale price and current cash rents imply a capitalization rate of less than 7.5%. The Company intends to use the proceeds from the transaction to reduce debt and for general corporate purposes.

Construction of the eight facilities was funded by MPT for their original operator, Adeptus Health (“Adeptus”), between 2015 and 2017 at a total initial cost of $92 million. The specific locations for the hospital and surrounding FSEDs were chosen carefully in the underwriting process based on their strategic value in caring for lower-acuity patients closer to their homes and in diagnosing injuries and illnesses requiring advanced treatment at the system’s general acute facilities. Shortly after Adeptus filed for Chapter 11 bankruptcy protection in 2017, Dignity Health recognized the value of this footprint within a growing and aging local healthcare ecosystem and leased the facilities without interruption to care or any change to the rental rate.

Medical Properties Trust, Inc. is a self-advised real estate investment trust formed in 2003 to acquire and develop net-leased hospital facilities. From its inception in Birmingham, Alabama, the Company has grown to become one of the world’s largest owners of hospital real estate with 436 facilities and approximately 43,000 licensed beds in nine countries and across three continents as of March 31, 2024. MPT’s financing model facilitates acquisitions and recapitalizations and allows operators of hospitals to unlock the value of their real estate assets to fund facility improvements, technology upgrades and other investments in operations.

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