First Citizens Bank Provides $36.2 Million in Financing for Acquisition of Medical Office Buildings in North Carolina and Washington

Rhea-AI Summary

First Citizens Bank's Healthcare Finance division provided $36.2 million in acquisition financing to Anchor Health Properties to recapitalize three medical office buildings in Charlotte, NC, and Seattle, WA. This move showcases the bank's strong relationship with its clients and its commitment to supporting their growth initiatives. The transaction highlights the bank's expertise in arranging timely and significant financing for the continued growth of its clients' portfolios.

Financial Analyst

The provision of $36.2 million in acquisition financing from First Citizens Bank to Anchor Health Properties is a significant transaction within the healthcare real estate sector. This move indicates a robust appetite for investment in medical office buildings, a sub-sector that has shown resilience and growth even during economic downturns due to the non-cyclical nature of healthcare demand. The acquisition financing will likely enhance Anchor Health Properties' balance sheet by allowing them to control these assets solely, rather than in a joint venture, thereby potentially increasing their operational efficiency and financial returns.

The transaction may also signal confidence in the healthcare real estate market in both Charlotte and Seattle, suggesting that these areas are seen as strong markets for medical office investments. Stakeholders should monitor the performance of these assets as an indicator of the viability of similar investments in comparable urban markets. The deal could also have a positive impact on First Citizens Bank's revenue through interest income and related financial services provided to Anchor Health Properties.

Market Research Analyst

Medical office buildings represent a niche but growing segment of the commercial real estate market. The investment by Anchor Health Properties, supported by First Citizens Bank, underscores the attractiveness of this segment due to its defensive characteristics and ties to the expanding healthcare industry. As populations age and healthcare services become more decentralized, moving away from traditional hospital settings, the demand for strategically located medical office buildings is expected to increase.

For investors and businesses evaluating the healthcare real estate market, it is important to consider the long-term trends driving demand, such as technological advancements in healthcare delivery, the shift towards outpatient services and the emphasis on accessibility and convenience for patients. These trends suggest a sustained demand for medical office space, which could result in favorable returns for investors like Anchor Health Properties and their financial backers.

Commercial Real Estate Expert

The recapitalization of medical office buildings, as seen in the transaction between First Citizens Bank and Anchor Health Properties, reflects a strategic approach to real estate asset management within the healthcare industry. Medical office buildings are typically characterized by long-term leases and stable tenant bases, often including healthcare systems, physician groups and other medical service providers. These attributes contribute to a steady cash flow and reduced vacancy risk, making them an attractive asset class for real estate investors.

Furthermore, by acquiring these assets directly for its balance sheet, Anchor Health Properties may be positioning itself for greater control over property management and tenant mix, which can lead to enhanced value creation. This transaction also demonstrates the importance of specialized financial services, such as those offered by First Citizens Bank's Healthcare Finance division, in facilitating complex real estate deals that require industry-specific knowledge and expertise.

JACKSONVILLE, Fla., Jan. 25, 2024 /PRNewswire/ -- First Citizens Bank today announced that its Healthcare Finance business provided $36.2 million in acquisition financing to Anchor Health Properties to recapitalize three medical office buildings located in Charlotte, North Carolina and Seattle, Washington. Anchor Health Properties acquired these assets directly for its own balance sheet.

"We appreciate the efforts of First Citizens Bank Healthcare Finance division and their collective expertise in arranging this financing for a timely and significant recapitalization of assets previously owned in joint venture format," said James Schmid, chief investment officer and managing partner of Anchor Health Properties. "First Citizens Bank has once again proven to be a valued banking relationship supporting the continued growth of our medical office building portfolio."

"Anchor Health Properties is a valued client and we're delighted to support their growth initiatives with this financing so they can continue to build their high quality portfolio of medical office buildings," said William Douglass, group head for Healthcare Finance.

"This transaction is an example of the deep relationships we foster with our clients that enable us to support them through various business endeavors," said Steve Reedy, a managing director and head of medical office banking in Healthcare Finance.

First Citizens Healthcare Finance provides comprehensive financing and banking solutions to middle market healthcare companies across the U.S. Using a client-focused and industry-centric model, Healthcare Finance can tailor its products and services to help clients meet their needs for growth capital.

About First Citizens Bank
First Citizens Bank helps personal, business, commercial and wealth clients build financial strength that lasts. Headquartered in Raleigh, N.C., First Citizens has built a unique legacy of strength, stability and long-term thinking that has spanned generations. First Citizens offers an array of general banking services including a network of more than 500 branches and offices in 30 states; commercial banking expertise delivering best-in-class lending, leasing and other financial services coast to coast; innovation banking serving businesses at every stage; and a nationwide direct bank. Parent company First Citizens BancShares, Inc. (NASDAQ: FCNCA) is a top 20 U.S. financial institution with more than $200 billion in assets. Discover more at firstcitizens.com.

MEDIA RELATIONS:
Ella Bristow
212-461-5322
Ella.Bristow@firstcitizens.com

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/first-citizens-bank-provides-36-2-million-in-financing-for-acquisition-of-medical-office-buildings-in-north-carolina-and-washington-302044772.html

SOURCE First Citizens Bank

How much financing did First Citizens Bank's Healthcare Finance division provide to Anchor Health Properties for the acquisition?

First Citizens Bank's Healthcare Finance division provided $36.2 million in acquisition financing to Anchor Health Properties for the recapitalization of three medical office buildings.

Where are the medical office buildings located?

The medical office buildings are located in Charlotte, North Carolina, and Seattle, Washington.

What type of financing did First Citizens Bank provide to Anchor Health Properties?

First Citizens Bank provided acquisition financing to Anchor Health Properties for the recapitalization of the medical office buildings.

What kind of banking solutions does First Citizens Healthcare Finance provide?

First Citizens Healthcare Finance provides comprehensive financing and banking solutions to middle market healthcare companies across the U.S.