Newmark : Announces Sale, Equity Placement and Financing of 12-Property Medical Office Portfolio

November 7, 2022 12:00 PM

Newmark announces the sale, equity placement and financing of a 12-property, 352,981-square-foot multi-state medical office building portfolio. Senior Managing Director Jay Miele, Executive Managing Director Ben Appel and Senior Managing Directors Michael Greeley and John Nero of Newmark's Healthcare Capital Markets group, in cooperation with local licensees, represented the seller in the transaction. Newmark Associates Adam Goss and Ron Ott provided financial analysis.

"We were thrilled to have advised our client on the sale of the portfolio, procurement of the institutional joint venture and structuring of the debt facility for this acquisition," said Miele. "The assets combine to offer income durability from long-term leases for nearly half of the portfolio, coupled with near-term growth opportunities stemming from accretive leasing to existing and new tenants in markets with strong underlying and long-term fundamentals."

The 12-building portfolio was acquired by Rendina Healthcare Real Estate, in joint venture with Artemis Real Estate Partners and CalSTRS. Newmark advised on the formation of the joint venture in 2021 which was seeded with a portfolio of six medical office buildings that were developed and acquired by Rendina. "We were excited to work with Rendina and Artemis as they continue to aggregate strategic assets for their $1 billion joint venture," said Appel. "In a turbulent capital markets environment, we applaud the steadfast diligence and commitment of Rendina, Artemis and its lender to achieve this successful closing."

Utilized for high acuity services, the collection of best-in-class assets spans eight states - Florida, Georgia, Illinois, Minnesota, Nevada, Ohio, Texas, Virginia - and is 96% occupied. The portfolio boasts attractive investment fundamentals including ten of the 12 assets located in Certificate of Need states, a weighted average remaining lease term of 6.6 years and average annual rental rate increases of 2.20%. At net operating income per occupied square foot of approximately $21 NNN, average rents across the portfolio are approximately 10% below national portfolio averages traded over the last five years. More than half of leased space is occupied by leading health systems, credit tenants and dominant physician networks.

In October, Newmark also facilitated the sale of a five-property medical office portfolio on behalf of the seller.

About Rendina Healthcare Real Estate
Rendina is a recognized leader in healthcare real estate and a trusted real estate partner for health systems, hospitals, and medical groups throughout the country. Over the course of 35 years, Rendina has developed and acquired more than 7.88 million square feet. Historically, 85 percent of its transactions are for existing relationships, a tacit endorsement from a notable client roster. Rendina's completed projects span the country and are supported by its headquarters in South Florida and five satellite offices in strategic regions across the United States including Arizona, California, New Jersey, Ohio and Texas. Through this network the Company's national reach and experience is accentuated by its physical presence in many of the nation's key healthcare markets. With an exclusive focus on healthcare real estate and an unparalleled sector knowledge, Rendina's full-service platform provides an array of services related to strategy, execution, and operations. Highlighted among them are ambulatory planning, feasibility analysis, site selection, at-risk development, design, construction oversight, space programming, acquisitions, leasing, and property management. Collectively, Rendina can deliver a single-source solution for its healthcare clients, an important distinction from merchant builders and design-build firms. With an average executive management tenure of more than 15 years and a tenant satisfaction rate consistently greater than 90%, the success of Rendina's platform echoes both internally and externally. From the inception of a project vision through the entire project life cycle, Rendina has the scale, experience, insight and passion to turn any vision into a reality.

About Artemis Real Estate Partners
Artemis Real Estate Partners is an investment manager based in metropolitan Washington, DC, with offices in New York City, Los Angeles and Atlanta. Artemis has raised approximately $6 billion of capital across core, core plus, value-add and opportunistic strategies. The firm makes equity and debt investments in real estate across the United States, with a focus on healthcare real estate (including medical office and senior housing), multifamily, industrial, office, retail, hospitality, and self-storage. Artemis specializes in joint venture partnerships with established, diverse and emerging operating partners and direct investments. More information can be found at www.artemisrep.com.

About Newmark
Newmark Group, Inc. (Nasdaq: NMRK), together with its subsidiaries ("Newmark"), is a world leader in commercial real estate, seamlessly powering every phase of the property life cycle. Newmark's comprehensive suite of services and products is uniquely tailored to each client, from owners to occupiers, investors to founders, and startups to blue-chip companies. Combining the platform's global reach with market intelligence in both established and emerging property markets, Newmark provides superior service to clients across the industry spectrum. Newmark generated revenues of approximately $3.1 billion for the twelve months ending September 30, 2022. Newmark's company-owned offices, together with its business partners, operate from approximately 180 offices with nearly 6,700 professionals around the world. To learn more, visit nmrk.com or follow @newmark.

Discussion of Forward-Looking Statements about Newmark
Statements in this document regarding Newmark that are not historical facts are "forward-looking statements" that involve risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements. These include statements about the effects of the COVID-19 pandemic on the Company's business, results, financial position, liquidity and outlook, which may constitute forward-looking statements and are subject to the risk that the actual impact may differ, possibly materially, from what is currently expected. Except as required by law, Newmark undertakes no obligation to update any forward-looking statements. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see Newmark's Securities and Exchange Commission filings, including, but not limited to, the risk factors and Special Note on Forward-Looking Information set forth in these filings and any updates to such risk factors and Special Note on Forward-Looking Information contained in subsequent reports on Form 10-K, Form 10-Q or Form 8-K.