NorthWest International Healthcare Properties REIT (TSXV:MOB.UN) this week finalized the purchase of 16 medical office buildings in two separate transactions in the German cities of Berlin, Ingolstadt and Leipzig, which is expected to close on or before March 31, 2014.
NorthWest International, which also sold a non-core leasehold interest in a Marktredwitz building for approximately $7 million to help fund the new German acquisitions, now owns 21 medical properties in the European economic powerhouse (two shown in the picture).
The 500,000-square-foot portfolio is 96 per cent occupied with a weighted average lease expiry of seven years. The $98-million purchase price represents an approximate eight per cent stabilized cap rate. The acquisitions, which will be funded from existing resources and new mortgage facilities of $64 million, are expected to immediately add to earnings.
Following completion of the German acquisition, NorthWest International’s portfolio will be weighted 19% Germany, 48% Brazil, 19% Canada and 13% Australia. The company expects further international holdings to drive future growth.
The sky appears to be unlimited in the international markets NorthWest International has targeted.
“In Brazil, we have seen some phenomenal growth. NorthWest International is the first focused healthcare real estate owner, and this is a very similar story in Germany.”
NorthWest’s international healthcare REIT has more than quadrupled since being created about 18 months ago. Since inception in October 2012, the business has grown from approximately $180 million in assets to $860 million upon completion of the recently announced German acquisition.
NorthWest International is headed by CEO and chairman Paul Dalla Lana, the founder of NorthWest Value Partners Inc., founder and chairman of NorthWest Healthcare Properties REIT (NWH.UN-T ) and a director of affiliated company Vital Healthcare Property Trust. Vital Healthcare, which is listed in New Zealand.
Northwest Value Partners owns approximately 82% of NorthWest International and its subsidiary NorthWest International Asset Management Inc. acts as its manager.