Fresenius Medical Care
Corporately Guaranteed | On Hospital Campus | Ground Lease | 10% Rent Increase (2028)
Marketing description
Overview
Peranich Huffman Net Lease Group is pleased to offer for sale, the Fresenius Medical Care of Vivian, LA. Built in 2018, the 5,211 SF, single tenant dialysis facility is offered at a 6.70% capitalization rate. The offering provides an investor with the opportunity to acquire a property that is home to a national medical tenant that exemplifies a reputation of consistency for both patients and the real estate investment community.
Lease Term
Fresenius Medical Care has occupied the single tenant dialysis facility since its completion in 2018. With 7 years of lease term remaining, the corporately guaranteed lease provides for 10% rent escalations every 5 years with the next increase occurring in June of 2028.
Leasehold Interest
The property is subject to a long-term 100-year ground lease with the neighboring North Caddo Hospital. Fresenius is solely responsible for all ground lease rent payments and operating expenses; thus, the new owner is not responsible for the payment of the ground lease’s rent.
Investment Grade Tenant
Fresenius Medical Care is the largest provider of renal care in both the United States and across the world. Fresenius has a net worth of $22.5+ billion and holds S&P’s Investment Grade credit rating of “BBB Stable”. Through its network of 4,000+ dialysis clinics, Fresenius Medical Care provides dialysis treatments for 348,000 patients globally.
Investment highlights
Contractual Rent Growth
The lease provides for 10% rent escalations every five years. The next escalation occurs in June 2028, increasing the NOI to $160,470 and pushing the going-in cap rate from 6.70% to 7.37% on today’s purchase price.
Passive Ownership
The tenant carries property taxes, insurance, utilities, landscaping, janitorial, parking lot repair, HVAC repair, and the interior, leaving the landlord with minimal responsibilities on a ground lease structure.
Investment-Grade Credit Behind the Lease
Rent income is guaranteed by Fresenius Medical Care Holdings, Inc., the world’s leading provider of dialysis products and services, treating 345,000+ patients across a global network of 4,000+ clinics.
Irreplaceable Hospital-Campus Location
The subject property is located on the North Caddo Hospital campus, the only hospital within a 30-mile radius, with 20+ specialties and a 24/7 Emergency Department. This Fresenius clinic is the sole dialysis provider within a 30+ minute drive, anchoring a durable, need-based patient population.
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