BETHESDA, Md. – Bethesda, Md.-based Global Medical REIT Inc. announced Wednesday that on Dec. 30, it entered into a purchase contract to acquire Great Bend Regional Hospital for a purchase price of $24,500,000. However, local hospital officials stressed this includes the building and property only, and local control of the facility will remain intact.
Closing on the deal is expected in the first quarter of 2017, at which time the current tenant, Great Bend Regional Hospital LLC., is expected to enter into a 15-year triple-net lease with GMR. GMR expects to fund this acquisition using borrowings from the company’s credit facility or other available cash.
In other words, local hospital officials said the day-to-day operations will remain as they are, and no jobs will be lost.
“I am very happy to close out 2016 with strong acquisition momentum following the execution of this agreement to acquire the Great Bend Regional Hospital,” said David Young, GMR’s chief executive officer. “Moving into 2017, we expect to continue our policy of announcing material acquisitions when we enter into purchase contracts and announcing other smaller acquisitions through periodic acquisition updates.”
A triple-net lease is a lease agreement that designates the lessee, which is the tenant, as being solely responsible for all the costs relating to the asset being leased, in addition to the rent fee applied under the lease. The structure of this type of lease requires the lessee to pay the net amount for three types of costs, including net real estate taxes on the leased asset, net building insurance and net common area maintenance.
Global Medical is engaged primarily in the acquisition of licensed healthcare facilities and the leasing of these facilities to leading clinical operators with dominant market share.
GBRH is a 33-bed acute care hospital located in Great Bend serving 50,000-plus community residents. The 58,000 square-foot facility is the sole community provider in its medical service area, where it provides services including women’s health, surgical, ancillary, hospital, and walk-in treatment.