Capital One Medical Office Team Sees Positive Business Momentum Through 2020

Capital One announced its Medical Office team, part of the Capital One Healthcare Real Estate business, closed 43 deals totaling about $2.5 billion throughout 2020. The team funded transactions ranging from $15 million single-asset loans to $1 billion value portfolios across medical office buildings, medical properties, life science transactions and healthcare REIT lending. Since 2010, this team–which was acquired in 2015 by Capital One from GE Capital Healthcare Financial Services–has financed in excess of $18 billion in balance sheet debt in the medical office and life sciences space.

“We were able to support our existing customers and lend to new borrowers during a challenging year by tapping into our healthcare expertise, structure and flexibility, risk-adjusted pricing on balance sheet relationship lending, and most importantly, certainty of execution,” said Erik Tellefson, Managing Director of Capital One Healthcare Financial Services. “Our bespoke lending aligned with the borrowers’ respective plans, and our strong support of sponsors’ growth in 2020 was evident in the transactions we were able to fund.”

Medical Office Transactions

Invesco Real Estate and Welltower Inc.

Capital One closed two deals for the joint venture of Invesco Real Estate, a global real estate investment manager, and Welltower, Inc. The first was a $382.5 million loan to finance the acquisition of a national portfolio of 31 medical office buildings across 15 states. The second was a $211 million transaction to finance the acquisition of 20 medical office buildings across five states. The properties include medical centers, outpatient centers, neuroscience and heart centers, among others.

“We worked closely with all parties to provide an all-encompassing healthcare real estate solution that included loan underwriting, capital markets and syndication,” said Tellefson.

“Capital One’s execution of this loan supports our goals to expand in the healthcare space and enhance our portfolio,” said Paul Nelson, Managing Director of Investment Management at Invesco Real Estate. “This acquisition enables us to grow our presence in new markets and continue to serve the medical community.”

Landmark Healthcare Facilities

Capital One provided $349 million to refinance 10 single asset loans with Landmark Healthcare Facilities. The team worked with Landmark to provide a bespoke solution, aligning the debt structure to their business plan and operating agreement requirements.

Kayne Anderson and Remedy Medical Properties

Capital One financed four deals for Kayne Anderson and Remedy Medical Properties. This included a $257 million transaction to acquire a 24-asset medical office building portfolio. The team has executed more than fifty transactions with the joint venture since 2012.

Life Sciences Transactions

BioMed Realty Trust, Inc.

Capital One financed a $404.2 million loan as part of a largely syndicated transaction with BioMed–a top sponsor in the life sciences space. The transaction allowed BioMed to acquire an office building that will be converted to a life science and laboratory building in Boston, Massachusetts.

Harrison Street Real Estate

Capital One financed a $69.5 million transaction for the acquisition of an asset in Palo Alto, California. This transaction represents the team’s continued support of a long-term customer in the life sciences market.

In addition, Capital One closed transactions with the following businesses in 2020, ranging from large sponsors to midsize borrowers:

●            Starwood Barlow: $123.2 million first mortgage to acquire a medical office building.

●            Davis and Physicians Realty Trust: $86.7 million transaction to finance the acquisition and recapitalization of a seven-asset medical office building portfolio.

●            White Oak: $61.6 million first mortgage to finance the acquisition of 12 medical office buildings.

●            Anchor Health Properties and The Carlyle Group: $51.7 million loan for three properties.

●            Lincoln Property Company, on behalf of a public pension fund client: $44.6 million term loan to finance the acquisition of seven medical office buildings.

●            Heitman and Montecito: $40.5 million first mortgage to finance the acquisition of a four-asset medical office building portfolio.

●            Anchor Health Properties and Harrison Street Real Estate: $25.8 million loan for a three-asset portfolio.

●            Altera Houston: $11.4 million first mortgage to finance a single medical office building.

●            Prospect Ridge and Elliott Bay Capital: $3.4 million first mortgage to finance the acquisition of a single asset.

The Healthcare Real Estate Medical Office team provides customized solutions to the medical office and life science sectors. Products include first mortgages, interim financing and acquisition financing for healthcare investors, operators and developers.

Capital One Healthcare is a leading provider of financial services to the industry. Customers across healthcare sectors—including senior housing, healthcare services, pharmaceuticals, medical devices, healthcare IT and medical offices—rely on Capital One Healthcare to finance acquisitions, refinance existing debt, support working capital needs and fund growth initiatives. With in-depth expertise, our team of professionals creates solutions tailored to meet the needs of our customers. Additional information can be found at capital.one/healthcare.

About Capital One

Capital One Financial Corporation (www.capitalone.com) is a financial holding company whose subsidiaries, which include Capital One, N.A., and Capital One Bank (USA), N.A., had $305.4 billion in deposits and $421.6 billion in total assets as of  December 31, 2020. Headquartered in McLean, Virginia, Capital One offers a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. Capital One, N.A. has branches located primarily in New York, Louisiana, Texas, Maryland, Virginia, New Jersey and the District of Columbia. A Fortune 500 company, Capital One trades on the New York Stock Exchange under the symbol "COF" and is included in the S&P 100 index.