• The hospital was built as an acute care facility with ICU headwalls, piped oxygen, negative pressure rooms, pharmacy with IV hood, dialysis, lab, etc. This is uncommon for an IRF and makes the facility very adaptable for many other uses. The current tenant is a single-location IRF and is vacating due to low census. The property needs a large diversified operator with an established referral network (see Market/Use Study). The $14M price is a pro-forma 10% cap rate on $25 NNN rents and could be sold when a new tenant is in place at a 7% cap rate for $20M.
• The adjacent MOB is also for lease/sale separately and was fully leased until the 2499 hospital opened less than a mile away in 2010. The docs that left are now facing 10-yr renewals at $30-40 NNN and looking for less expensive options. The MOB asking rent was recently reduced to $13.50 NNN from $21 NNN with an estimated 12-18 month lease-up period. The lowest comp is $15 NNN (not medical) and the CoStar average is $21 NNN. The $5.8M price is a pro-forma 12% cap rate on $15 NNN avg. rents at lease-up and could then be sold at an 8% cap rate for $8.75M or $10.3M in yr-5 due to $1 bumps.
