AW Property Closes $193M MOB Portfolio Recap

1250 S. Tamiami Trail, Sarasota, Fla. Image courtesy of Kaufman Hall and Associates

AW Property Co. has recapitalized a 19-building, 525,759-square-foot medical office portfolio in Florida through a $193 million joint venture equity raise with an undisclosed national institutional investor.

The portfolio comprises a diverse mix of on- and off-campus medical office buildings aligned with several of the nation’s leading non-profit health systems.

It was owned by a discretionary real estate fund sponsored by AW, a North Palm Beach, Fla.,-based real estate investment and operating company specializing in medical office building properties in major markets throughout the Southeastern U.S. 1250 Medical Plaza, a medical office building at 1250 S. Tamiami Trail in Sarasota, Fla., is among the assets in the transaction.

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Chicago-based Kaufman Hall and Associates served as the exclusive financial advisor to AW to seek a joint venture equity partner for the AW fund portfolio. Kaufman Hall’s real estate practice provides transaction advisory services to many of the nation’s top health-care providers and developers of health-care real estate.

On behalf of AW, Kaufman Hall undertook a competitive effort to identify the most appropriate institutional capital partner. The firm’s efforts included approaching a diverse pool of potential equity partners, including investors with previous medical office experience and firms with no prior experience with health-care real estate.

Based on Kaufman Hall’s efforts, the sponsor and the opportunity, AW received multiple proposals from various investor types including domestic pension fund advisors, foreign capital sources and private equity groups. The structured and highly competitive process resulted in AW selecting a well-established institutional investment manager with a national presence among multiple real estate asset types.

Since 2005, AW has sponsored health-care real estate investments with an aggregate market value of $620 million spanning 2.7 million square feet of rentable space in 16 submarkets.

Recent recapitalizations

Other health-care property owners have gone the recapitalization route in recent months. Last month, Remedy Medical Properties, Kayne Anderson Real Estate and MedProperties Realty Advisors LLC formed a $350 million-plus joint venture to recapitalize an 11-state, 23-asset health-care real estate portfolio totaling more than 1 million square feet owned by MedProperties. The assets are located in some of the country’s top metropolitan areas and strategic, secondary markets in states including Texas, Florida, New York and North Carolina.

In late 2021, Seavest Healthcare Properties closed on a new partnership transaction valued at $1 billion as it brought on Nuveen Real Estate as co-owner of an unidentified segment of the health-care real estate investment firm’s collection of medical office buildings in the U.S.