KKR, Cornerstone in $ 1 Billion Healthcare Development Joint Venture

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Cornerstone Companies CEO J. Taggart Birge and KKR Co-Chairman Henry Kravis (Cornerstone, Getty, iStock)

KKR and Cornerstone Companies Partner to Develop Healthcare Facilities in the United States.

Cornerstone has previous experience in the market as the company is a healthcare real estate investment, development and management company. According to Real Estate Weekly, the joint venture will be seeded with 25 properties that will be recapitalized.

The joint venture aims to acquire more than $ 1 billion worth of real estate over the next few years. Cornerstone and KKR have made funding commitments, with the latter drawing on real estate and loan funds.

The recapitalized portfolio includes more than 713,000 square feet of outpatient surgery centers and medical offices in 12 states. They already have long-term leases, the publication says.

This portfolio appears to reflect the type of assets that KKR and Cornerstone will pursue in their new joint venture. The two companies aim to acquire and develop single-tenant medical office buildings, outpatient operation centers, and facility-based outpatient healthcare facilities. The focus is on long-term rental agreements.

Doctors’ offices are seen as a rare ray of hope for real estate investors during the pandemic. According to an April report, despite a sharp drop in personal visits, medical professionals had paid 95 percent of rent owed year over year.

Medical office buildings were sold for $ 11.2 billion in 2020, up from $ 12 billion in 2019.

After launching Strategic Lease Partners in August, KKR also has its sights set on a portfolio of triple net leasing investments totaling $ 3 billion.

[REW] – Holden Walter-Warner


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