NorthWest International Healthcare Properties REIT Announces C$120M Sale Leaseback of Leading Brazilian Hospital
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TORONTO, Dec. 27, 2012 /CNW/ - NorthWest International Healthcare Properties Real Estate Investment Trust (TSXV: MOB.UN) (the "REIT") announced today the acquisition of Hospital e Maternedade Brasil ("HMB") located in suburban Sao Paulo, Brazil from Rede D'Or São Luiz S.A. ("Rede D'Or") for approximately C$120.0 million. Concurrent with the sale, Rede D'Or entered into a fully net 25 year leaseback of the property with an initial annual rent of approximately C$12.3 million, representing a 10.25% intial cap rate, plus annual inflation adjustments.
The acquisition represents the REIT's second investment in Brazil and solidifies its position as a leading owner of healthcare real estate in the country and is immediately accretive. Adjusting for the acquisition, the REIT's weighted average occupancy and lease term have increased to 99.4% and 13.6 years, respectively, reinforcing the defensive nature of its portfolio. In addition, post acquisition, approximately 99% of the REIT's rental revenue will be indexed to inflation, adding to its organic growth prospects.
At approximately 342,000 square feet and with 305 beds, HMB is the largest full-service hospital in Santo Andre, a suburb of Sao Paulo, located approximately 30 km south of the city centre. HMB is operated by Rede D'Or, a privately owned Brazilian hospital operator with 26 hospitals across the country and a dominant presence in Rio de Janeiro under the "D'Or" hospitals brand; São Paulo under the "São Luiz" brand and Brasilia under the "Santa Lucia" brand. Rede D'Or is the largest network of private hospitals in Brazil and is widely regarded as one of the fastest growing, and leading hospital operators in the country.
The gross purchase price of C$120.0M includes C$24.0M of deferred consideration, which is due in one year. The REIT's investment was funded from existing resources and new mortgage financing from BTG Pactual Bank for C$60.0M at an interest rate of 6.80% plus annual inflation for a two year term. The acquisition closed earlier today, contemporaneously with the signing of definitive agreements and is subject to customary post-closing adjustments.
About NorthWest International Healthcare Properties Real Estate Investment Trust
The REIT is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. Including its investment in Vital Healthcare Property Trust (NZX: VHP), the REIT holds interests in a portfolio of 31 income-producing properties, with a focus on internationally-located medical office buildings and healthcare real estate, comprising approximately 1.5 million square feet of gross leasable area located in Australia / New Zealand, Brazil and Germany.
Forward Looking Information
Certain statements contained in this news release may contain projections and "forward looking statements" within the meaning of that phrase under Canadian securities laws. When used in this new release, the words "may", "would", "should", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" and similar expressions may be used to identify forward looking statements. Those statements reflect the REIT's current views with respect to future events or conditions, including completion of the offering and the proposed use of proceeds. By their nature, forward looking statements reflect management's current views, beliefs and assumptions and are subject to certain risks and uncertainties, known and unknown, including, without limitation, risks disclosed in the short-form prospectus of the REIT dated December 7, 2012 and in the REIT's other public filings. Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by these forward looking statements. The REIT does not intend to nor assume any obligation to update these forward-looking statements whether as a result of new information, plans, events or otherwise, unless required by law.
These securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws and may not be offered or sold in the United States or to U.S. persons except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities laws or pursuant to an exemption therefrom. Accordingly, this news release does not constitute an offer for sale of securities in the United States.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: NorthWest International Healthcare Properties Real Estate Investment TrustFor further information:
Paul Dalla Lana
CEO, NorthWest International Healthcare Properties REIT
(416) 366-8300 ext. 1001