Our team initiated a dialogue with this client approximately two and a half years prior to the final closing date of the transaction. The ownership group, a general partnership comprised of multiple physicians associated with 21st Century Oncology, had a preliminary interest in understanding the value of one of their locations. As our dialogue progressed, ownership concluded, due to very favorable market conditions, it was in their best interest to pursue a portfolio sale of 20 locations in five states (CA, FL, KY, NV, and WV).
21st Century Oncology is the premier provider of cancer care services across multiple modalities, the largest radiation oncology provider and one of the largest groups of urologists in the U.S. For more than 31 years, 21st Century Oncology has been committed to providing state-of-the-art, academic quality radiation therapy and other cancer treatments in a patient-centric setting focused on continuous innovation. The physician-led company is headquartered in Fort Myers, Florida and operates 181 treatment centers, including 145 centers located in 16 U.S. states and 36 centers in Latin America.
Investors were especially attracted to this institutional-quality portfolio due to the tenant’s status as the largest provider of integrated cancer care services in the country. Furthermore, the investment opportunity of 20 single-tenant absolute triple-net leases offered long-term stable cash flow with rental growth. After a strategic and controlled marketing process, our team was able to identify the most qualified buyer at the highest price who was willing to accept the seller’s terms. An additional driving force behind this portfolio was the continued improvement and strengthening of the tenant’s credit and balance sheet as the transaction progressed. This was a result of a $325 million capital investment made by the Canada Pension Plan Investment Board (CPPIB) into 21st Century Oncology’s operations. We also worked with the tenant to secure a brand new master lease that encompassed all 20 locations prior to close. Due to our sole focus and specialization on healthcare real estate investment sales, we were able to capitalize on historically aggressive prices being paid for similar sizable healthcare and single-tenant net-leased portfolios. We were able to match an active, assertive institutional healthcare buyer with a seller who had built a valuable, high quality portfolio over a number of years. A private non-traded healthcare REIT ultimately ended up purchasing the portfolio for just over $117 million on an all-cash basis
Seller Profile: General Partnership of Practicing Physicians and Investors – Fort Myers, FL
Buyer Profile: Non-Traded, Private Healthcare Real Estate Investment Trust (REIT) – Tampa, FL