Medical Properties Trust Inc. has completed the previously revealed joint venture among certain of its European affiliates and affiliates of Primonial Group. As previously disclosed, the joint venture agreements establish a value of the 71 assets of €1.63 billion, reflecting an unlevered internal rate of return exceeding 15% since MPT’s acquisition of the assets.
According to a prepared statement, total proceeds to MPT, including its portion of secured debt, are approximately €1.14 billion. The company expects to use such proceeds to repay balances under its revolving credit facility, make investments in additional U.S. and European hospital assets and for other corporate purposes.
“This partnership with Primonial demonstrates MPT’s unique expertise and ability to create long term value for our shareholders, reduce our cost of capital and provide permanent capital for reinvestment to create additional highly attractive hospital real estate portfolios,” said Edward K. Aldag, Jr., MPT’s Chairman, President and CEO. “Already we are highly focused on reinvestment of proceeds to acquire hospital real estate leased to high-quality operators in Europe, the U.S. and elsewhere.”
MPT also disclosed that the joint venture has entered into a €655 million secured financing arrangement with a consortium of lenders, including Societe Generale S.A. Frankfurt Branch as Mandated Lead Arranger and affiliates of AXA. Provisions of the financing agreement include a term of seven years and a swapped fixed rate of approximately 2.3%.