HEALTH Realty Investments sells portfolio for $112 million

Photo by Huy Nguyen on Unsplash

HEALTHCARE real estate investments, a private equity and real estate investment firm, sold a portfolio of 13 multi-family properties with nearly 1,600 units for $112 million. The portfolio, which contained apartments throughout the southeastern United States, was part of HEALTH High Yield Fund III.

The disposition was the final sale in the fund as HEALTH closed it. The company did not disclose the buyer or the location of the properties. SANTÉ, which also has an office in Luxembourg, has a history of managing $2.5 billion in residential assets. The Company has properties or developments across the United States in Arizona, California, Indiana, Kansas, Missouri, Nevada, South Carolina, Tennessee, Texas and Washington, as well as in Spain.

Jeremy Guay, HEALTH’s chief investment officer, said in a prepared statement that the company closed the fund at substantial value for investors. However, he noted that the company had made a strategic decision to shift from investing in value-added properties such as portfolio sale apartments to less operationally intense assets.

New focus on land lease

Guay said the new strategy will focus on its ground lease program, which provides sale-leaseback financing to real estate developers across the United States. Earlier this month, HEALTH announced a $570 million financing deal for its new ground lease fund. HEALTH Realty Fund II is designed around the acquisition of land leases and NNN rental real estate projects in strategically identified markets across the country.

The company said the anchor investment came from an undisclosed institutional investor. Since the underlying ground lease is secured by a building, ground lease investments are extremely attractive to institutional investors, according to the company. The $570 million will be split into multiple tranches over the next 36 months. The first installment is expected tomorrow, April 1.

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