Global Medical REIT (GMRE) to Acquire Three Rehab Hospitals

November 30, 2016 8:32 AM EST

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Global Medical REIT Inc. (NYSE: GMRE) announced that it has entered into purchase contracts to acquire three rehabilitation hospitals for an aggregate purchase price of $68,093,000. The three hospitals, discussed further below, are HealthSouth rehabilitation hospitals in Mesa, AZ, Altoona, PA and Mechanicsburg, PA.

David Young, Chief Executive Officer of GMR, stated, “I am very happy to announce that the Company has entered into purchase contracts to acquire three hospitals from affiliates of Healthcare Realty Trust, each of which is leased to HealthSouth Corporation under long-term triple net leases that we will assume upon closing. This transaction will represent a significant milestone in our continuing efforts to deploy the proceeds raised in our IPO that was completed in July. In addition, the credit facility announced with our third quarter results, along with capital that will become available as we place debt on various properties in our portfolio, will provide us with ample funding to facilitate our increasing pace of acquisitions in the near term.”

As indicated above, GMR intends to complete the three acquisitions in all-cash transactions using proceeds from the Company’s IPO. The Company intends to place debt on the properties subsequent to closing. In total, the three hospitals add approximately 196,000 square feet to GMR’s property portfolio while also yielding cap rates consistent with the Company’s existing property portfolio. These three transactions are contingent on each other, so the Company will not close one without closing the other two. The sellers are affiliates of Healthcare Realty Trust Incorporated (NYSE: HR). The Company’s due diligence period under each agreement expires on December 8, 2016, at which time its earnest money deposits become non-refundable. The Company has the right to terminate at any time prior to the expiration of the due diligence period. The Company expects to close the three acquisitions during the fourth quarter of 2016, subject to the satisfactory completion of due diligence and other customary closing conditions. There is no assurance that the Company will close these three acquisitions.

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