Remedy and Kayne Anderson acquire trophy MOB portfolio on hospital campus in south Atlanta suburb

FAYETTEVILLE, Ga., and CHICAGO, Aug. 2, 2023 – Remedy Medical Properties and Kayne Anderson Real Estate (KA Real Estate), together the nation’s largest private owner of healthcare properties, has acquired a two-building portfolio on the high-performing Piedmont Fayette Hospital campus in the south Atlanta suburb of Fayetteville.

The acquisition, which closed June 30, further expands and reinforces the relationship between Piedmont Healthcare Inc. and Remedy, already the health system’s largest landlord.

With Piedmont wanting to close by the end of its fiscal year, the fast-moving deal went from contract to close in about 28 days, normally taking from 60 to 90 days. But principals of Chicago-based Remedy and Boca Raton-based KA Real Estate say the speed of the acquisition of the five-story Class A+ medical office buildings (MOBs), named 1265 East and 1267 West, was just one of the mutually beneficial attributes of the transaction.

“These two MOBs are a highly strategic asset, not only for the campus, but also for Piedmont’s entire southeast Atlanta service area,” says Joe Magliochetti, Chief Investment Officer of Remedy. “The desirable demographics of this area, combined with an award-winning hospital, a portfolio with a tightly affiliated, high-caliber tenancy, and strong patient referral from outpatient care to the Piedmont hospital for inpatient procedures, are all hallmarks of a winning scenario for Remedy, Kayne Anderson Real Estate, and our partners at Piedmont.”

Other outstanding qualities of the two MOBs include their physical attachment to the high-volume, 282-bed hospital itself, along with some shared systems. With Remedy and KA Real Estate, Piedmont is getting a partner and property manager that will actively manage those systems to the benefit of both the inpatient and outpatient spaces.

“The location is excellent, in a growing area, and strong medical office submarket, with a strong healthcare demographic base,” Mr. Magliochetti continues. “It’s rare to find an investment opportunity with this combination of attributes in the Atlanta MSA.” 

The facilities, located at 1265 and 1267 Highway 54 W., are 97 percent leased by leading regional physician groups featuring diverse clinical specialties with strategic hospital affiliations. Specialties housed in the properties include oncology, a heart institute, imaging, infusion, women’s health, sleep health, cardiac rehab, nephrology, orthopedics, general surgery, endocrinology, physical therapy, pulmonology, and digestive healthcare. The 1265 building offers an ambulatory surgery center (ASC) and endoscopy lab.

“These two properties are home to a multitude of outstanding tenants with a weighted average lease term (WALT) just shy of 12 years,” says Antonio Minchella, Senior Managing Director, Medical Office, Kayne Anderson Real Estate. “Coupled with the high occupancy rate, this all but guarantees that these will be high-performing assets for many years to come.

“The two mission-critical facilities also offer a variety of attractive amenities,” Mr. Minchella adds, “including the seamless connection to the hospital, multiple covered patient drop-off and pick-up areas, free surface parking and shuttles, and an onsite Chick-fil-A restaurant.”

CBRE U.S. Healthcare & Life Sciences served as the broker for the transaction.

About Kayne Anderson Real Estate Kayne Anderson Real Estate (“KA Real Estate”) is a leading real estate private equity investor in medical office, seniors housing, off-campus student housing, multifamily housing and self-storage. KA Real Estate manages $14 billion of real estate AUM across opportunistic equity, core equity and real estate debt. KA Real Estate is part of Kayne Anderson Capital Advisors, L.P., a $32 billion alternative investment management firm with more than 39 years of successful experience in the real estate, infrastructure, credit, and growth capital sectors.