Medical Properties Trust, Inc. (MPT) has announced the sale of its interests in five Utah hospitals to a joint venture, generating approximately $1.1 billion in total cash proceeds. This brings MPT's total liquidity transactions year-to-date to $1.6 billion, which is 80% of the company's initial FY 2024 target.
The joint venture, formed with an investment fund affiliated with a leading institutional asset manager, saw the fund purchasing an approximate 75% interest for $886 million, validating MPT’s underwritten lease base of approximately $1.2 billion. MPT retained an approximate 25% interest in the venture.
Simultaneous with the sale, the venture secured new non-recourse financing, providing $190 million of additional cash to MPT based on its share of the proceeds, further confirming underwritten asset values.
The immediate cash proceeds of $1.1 billion are expected to be used to reduce outstanding debt, including the payment in full of an approximate $300 million Australian term loan due in 2024 and the repayment of borrowings under its revolving credit facility, along with general corporate purposes.
Edward K. Aldag, Jr., Chairman, President, and CEO of MPT, expressed confidence in exceeding the initial target of $2.0 billion in liquidity transactions in 2024, based on the valuations achieved on recent transactions and the terms actively being negotiated for additional transactions.
MPT is a self-advised real estate investment trust that has grown to become one of the world’s largest owners of hospital real estate with 439 facilities and approximately 43,000 licensed beds in nine countries and across three continents as of December 31, 2023. The market has reacted to these announcements by moving the company's shares -2.1% to a price of $4.74. If you want to know more, read the company's complete 8-K report here.
