Grubb & Ellis Healthcare announces acquisition of Lawton Medical Office Building Portfolio

Grubb & Ellis Healthcare REIT II, Inc. today announced that it has acquired Lawton Medical Office Building Portfolio, a two-property medical office building portfolio on the campus of Southwestern Medical Center in Lawton, Okla., and Ennis Medical Office Building, a 30,000-square-foot medical office building in Ennis, Texas.      

Located at 5604 and 5606 SW Lee Blvd., the Lawton Medical Office Building Portfolio is comprised of two three-story Class A single-tenant facilities totaling approximately 62,000 square feet on the campus of the 199-bed Southwestern Medical Center.  The medical office buildings are fully leased to the medical center until 2023, with options that could extend the leases until 2033.  

Built in 2008, Ennis Medical Office Building is a single-story, multi-tenant medical office building located adjacent to Ennis Regional Medical Center, a 60-bed acute-care facility that serves residents of the Dallas suburb.  The medical office building is currently 95 percent leased to a variety of tenants, including a primary medical services provider, outpatient surgery center and an internal medicine practice.

"Grubb & Ellis Healthcare REIT II found these acquisitions attractive because they passed two of our most basic tests – they are located on or near thriving and well-managed medical centers and their financial performance is supportive of our investor distribution," said Danny Prosky, president and chief operating officer of the REIT. "By following a disciplined acquisition strategy, we believe we can provide our stockholders with dependable income and superior long-term financial performance."

Lawton Medical Office Building Portfolio was acquired from Southwestern MOB I, LLC, an unaffiliated third party.  Grubb & Ellis Healthcare REIT II financed the acquisition using $9.8 million in borrowings under its line of credit with Bank of America, N.A. and cash proceeds received from its offering.  Ennis Medical Office Building was acquired from New Bardwell Partners, LP, an unaffiliated third party represented by Jim Moloney of Cain Brothers.  The REIT financed the acquisition using $7.35 million in borrowings under its line of credit with Bank of America, N.A. and cash proceeds received from its offering.  

As of Dec. 17, 2010, Grubb & Ellis Healthcare REIT II has sold approximately 14,332,337 shares of its common stock, excluding the shares issued under its distribution reinvestment plan, for approximately $142,993,000 through its initial public offering, which began at the end of the third quarter of 2009.

To date, the REIT has made 14 geographically diverse acquisitions comprised of 25 buildings valued at approximately $194 million, based on purchase price.