Ventas to buy life science and medical real estate assets for $1.5 billion
Staff Writer |
Ventas signed a definitive agreement to acquire substantially all of the life science and medical real estate assets of Wexford Science & Technology from affiliates of Blackstone Real Estate Partners VIII L.P. for $1.5 billion in cash.
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The acquisition will add a related business line to Ventas’s diverse portfolio with 25 class-A assets that are leased by leading universities, academic medical centers and research companies, including Yale University, the University of Pennsylvania Health System, Washington University in St. Louis, Wake Forest University and Alexion Pharmaceuticals.
The transaction is subject to the satisfaction of customary closing conditions and expected to close in the fourth quarter of 2016.
The portfolio includes 23 operating properties that contain 4.1 million square feet, are 97 percent leased and derive 73 percent of revenue from excellent credit tenants, including 11 universities with an average credit rating of Aa2, investment grade companies and public companies with an equity market capitalization exceeding $1 billion.
It also includes two development assets encompassing approximately 400,000 square feet, that are nearly 60 percent pre-leased and affiliated with Duke University and Wake Forest University. The Company is also acquiring nine development sites principally contiguous to existing assets.
The total consideration for the transaction is $1.5 billion plus the assumption of $33 million of liabilities.
The total consideration for the 23 operating properties is $1.4 billion (representing a 2017 cash yield of 6.8 percent); $88 million for the two development properties (representing an unlevered projected stabilized yield of approximately 7.5 percent inclusive of post-closing capital funding to complete and lease up the assets to stabilization); and $50 million for the development sites. ■