Grubb & Ellis Healthcare REIT Secures Increased Revolving Line of Credit

Strategic Insights -

Grubb & Ellis Healthcare REIT, Inc. has successfully negotiated an increase in its secured revolving line of credit with LaSalle Bank National Association, expanding the maximum principal amount available from $50 million to $80 million. This credit facility is designed to support the company's strategic initiatives, including property acquisitions and other business purposes. The three-year loan agreement offers flexibility in interest rate options, which can be chosen from LIBOR plus a margin of 1.50 percent, LaSalle's prime rate, or the Federal Funds Rate.

Key Takeaways:

  • Grubb & Ellis Healthcare REIT has increased its secured revolving line of credit with LaSalle Bank National Association from $50 million to $80 million.
  • The line of credit is for a term of three years and can be used for property acquisitions, other business purposes, and to support the company's growth strategy.
  • KeyBank National Association has joined LaSalle as a lender under the increased line of credit, demonstrating continued support for the company's business strategy.
  • As of December 7, 2007, Grubb & Ellis Healthcare REIT has sold over 19.9 million shares of its common stock for over $199 million through its initial public offering, which began in the third quarter of 2006.
  • The REIT offers a monthly distribution of 7.25 percent per annum and has made 17 geographically-diverse acquisitions valued in excess of $340 million.
  • The company seeks to acquire medical office buildings and other healthcare-related facilities to leverage the growing demand for healthcare services in the United States.
  • According to the U.S. Department of Health and Human Services, healthcare spending in the United States is expected to grow to 20 percent of GDP by 2015, with annual healthcare expenses projected to double to $4 trillion.

Statistics:

  • Maximum principal amount available under the line of credit: $80 million
  • Original maximum principal amount: $50 million
  • Term of the loan agreement: Three years
  • Interest rate options: LIBOR plus a margin of 1.50 percent, LaSalle's prime rate, or the Federal Funds Rate
  • Number of shares sold through the initial public offering: 19.9 million
  • Total amount raised through the initial public offering: $199 million
  • Monthly distribution offered by the REIT: 7.25 percent per annum
  • Number of geographically-diverse acquisitions made by the REIT: 17
  • Total value of acquisitions made by the REIT: Over $340 million

Sources:

  • Grubb & Ellis Healthcare REIT, Inc.
  • LaSalle Bank National Association
  • KeyBank National Association
  • U.S. Department of Health and Human Services
  • Health & Medicine Week via NewsRx.com