FINANCING
Somerset Medical Center
www.somersetmedicalcenter.com
Client Description:
Somerset Medical Center, a not-for-profit community hospital in Somerville, NJ.
Client Challenges:
After expanding its service line through the development of an outpatient cancer center, Somerset turned its attention to raising cash and paying down debt in order to improve its credit metrics and financial flexibility in a turbulent capital market.
Client Objective:
Free up cash and pay down debt by monetizing the Steeplechase cancer center through a sale/leaseback transaction with a sophisticated capital partner. Preserve control of the cancer center and work with a partner that could assist with physician recruitment and build-out of physician office suites were priorities.
Health Care REIT Solutions:
Acquired the cancer center and master leased it to Somerset Medical Center, which operates the cancer center and the office space for physicians. Health Care REIT continues to consult with Somerset on additional expansion and development projects.
Virtua strategic partnership
with Frauenshuh and Health Care REIT
www.virtua.org
Client Description:
Partnership between Virtua, a multi-hospital system in New Jersey, and Frauenshuh Healthcare Real Estate Solutions, a specialist in the development of health care real estate.
Client Challenges:
Expand service line in a capital constrained market through the development of a health and wellness center in Washington Township, NJ, with the development team committing significant funding in a manner consistent with current operating lease treatment accounting rules.
Client Objective:
Add state-of-the-art health and wellness center with onsite outpatient surgery, imaging, obstetrics, urgent care, radiation oncology, rehabilitation services, and primary care, as well as a fitness center, med spa, café and child care. Transfer real estate development risk from the hospital to the developer, while preserving Virtua’s operational control. Assure certainty of capital access and delivery of facility on time in order to meet Virtua’s operational goals.
Health Care REIT Solutions:
Health Care REIT provided the majority of construction and permanent capital to develop and own the 225,000-sq.-ft. health and wellness center in a joint venture with Frauenshuh. Financing structure achieved operating lease treatment for the hospital and completion timing met operational goals.
"The Virtua Health and Wellness Center represents a new era in health care. It's all part of growing our mission to the communities we serve in New Jersey. We appreciate the work that Health Care REIT and Frauenshuh accomplished for our Washington Township center. We had a great experience with our partners."
Rich Miller | President & CEO, Virtua