Healthcare Trust of America, Inc. (NYSE: HTA or the “Company”) announced today its investment activity for the beginning of 2016. This includes total investments closed in the first quarter of 2016 of approximately $163 million and an additional $210 million of investments under signed purchase and sale agreements expected to close primarily in the second quarter of 2016. HTA also has executed exclusive non-binding letters of intent to acquire several properties.
These investments continue HTA’s philosophy of acquiring medical office buildings affiliated with leading health systems in key markets located either on health system campuses, on academic medical centers, or in community core locations. The new investments that are closed or under contract are primarily focused in New England, Texas and other existing HTA key markets.
1Q 2016 Investments
Acquisitions that were completed in the first quarter of 2016 totaled $163 million and were acquired at an average first year unlevered yield between 6.0% and 6.5% overall, including:
- Yale One Long Wharf MOB (New Haven, CT): This 287,000 square foot medical office building (“MOB”) is 99% occupied and is located in New Haven, Connecticut. The building is located approximately one mile from Yale University and Yale University Health System’s main campus and includes a mix of health system, university, and independent physician tenants. This investment creates a new relationship with one of the nation’s top universities and grows HTA’s presence in the New England area. HTA acquired this property in January 2016 for approximately $74 million.
- Texas MOB Portfolio (primarily Houston and El Paso, TX): This seven building portfolio was acquired in February for approximately $83 million and consists of over 483,000 square feet of gross leasable area located on-campus with Tenet Healthcare hospitals in Houston and El Paso. Approximately 81% of the investment is in the Houston market, primarily consisting of a 251,000 square foot building located in the north end of the Texas Medical Center and attached to the Park Plaza hospital. The portfolio was approximately 86% occupied at closing. This acquisition increases HTA’s total investment in the Texas Medical Center to over 425,000 square feet and creates operating synergies for HTA’s property management and leasing platform.
- Charleston MOB (Charleston, SC): HTA also completed the acquisition of a 22,000 square foot MOB located in Charleston, SC for approximately $6 million. This building is 100% occupied and is adjacent to a local health system as well as an existing HTA MOB.
In addition to the completed acquisitions above, the Company has entered into definitive agreements to acquire MOBs with an aggregate purchase price of approximately $210 million. These MOBs total approximately 668,000 square feet of gross leasable area and are located within HTA’s key market areas in New England and the Midwest. The properties are either on-campus or in community core locations and are affiliated with leading health systems within their respective markets. The expected first year unlevered yield is between 6.0% and 6.5% on average for the group. These investments are expected to close primarily in the second quarter of 2016. The Company also has several properties under executed exclusive non-binding letters of intent.
The pending acquisitions described in this press release are subject to customary closing conditions. The non-binding letters of intent are subject to negotiation and execution of definitive agreements and customary closing conditions. There can be no assurance the Company will complete these transactions or acquire any of these buildings.