HTA - Earnings call transcript Q4 2019 | Healthcare Realty Trust Incorporated

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Operator

Good day, and welcome to the Healthcare Trust of America Fourth Quarter 2019 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to David Gershenson. ahead. go Please

David Gershenson

be welcome Please earnings and next for our days. Trust America’s being or will documents of supplement section and Investor Thank our webcast that of We to for this filed replay XX XXXX website can These close. call. after the and available on our year-end the the yesterday Relations SEC. you, with the Healthcare found note earnings be financial is release call

take questions at to of happy prepared remarks. conclusion be our will We your the

During make available the beliefs statements on we course of of the us. current to forward-looking are call, will the currently forward-looking statements. These information management and based

our known unknown affected Our actual uncertainties be results to risks, and will predict. or control ability are and by beyond trends, factors that

believe actual results or of are are reasonable, Although, our from future expectations. assumptions our they our future Therefore, we not that current performance. differ could materially guarantees

on which to description our refer website. potential please found detailed Relations of Investor be a the can For section risks, filings, SEC our in

turn Trust the Healthcare Peters, and Scott Chairman call to over of now America. CEO Scott? of will I

Scott Peters

XXXX Good conference for thank us full-year today morning, call. Healthcare of America’s quarter and and Trust joining fourth for you earnings

Officer; our Development. are today Milligan, Joining the President and Acquisitions Caroline Vice me of Management; on call Chiodo, Executive of and our Amanda Chief Asset Robert President Financial Houghton, Vice our Senior

the ownership, operation HTA XXXX, begin and has positioned leader itself leasing we in the medical As be office to of buildings. sector

portfolio square feet. We that irreplaceable, million XX have is a key with market-focused almost

to the years. three itself with returns sheet investment-grade full-service growth and and of integrated, has operating that uniquely positioned next is over deliver investments balance comprised shareholder earnings portfolio Our five fortress pursue and platform, to a positions us fully a HTA

in where place outpatient healthcare that University take cost-effective the the This on-campus, is leading community focusing is convenient country; experience integrated combinations their move it an academic critical. two, healthcare delivery providers of decade, and for will three are growing where to HTA in MOBs in off-campus and settings: locations, healthcare the patients. all As and continues towards academic one, locations, enters three, owner largest the are where and presence; new

last the growth critical MOBs reflects portfolio markets years. estate opportunities with that in future a that finding trends these built have on of we a focus over XX retention real levels tenant high will Over rental and years, core great of deliver

with critical Our experience that has with patient the drivers both the demonstrated related market demand, more tenant performance off-campus, synergies. on increasingly strongest and characteristics properties occur quality, to and primary building

key markets believe markets targeted HTA outperform we has that will country. other fast-growing Strategically, throughout the

targeted market We approach square feet and have in feet more. size Our markets. returns XX scale approximately now maximize allows X to with over XXX,XXX and markets or creating with XX million square by markets HTA

allows effectively and going are This scale This operating a strategic local strategy and us growth approach platform more deeper create with capabilities relationships key that unique. a for to our pillar forward. is operating

opportunities, led property our platform saw This same-store expense work growth increased of that management fourth platform generates expansion driven of margin growth by: XXXX, and internal one, by growth to X.X%. from rental In and both utilization same-store and of ways X.X%, in revenue X.X% quarter our savings. portfolio positive certain of of we the growth attributes and external start includes

blended or and cap of square X.X% more after full-year acquisitions feet, where than management re-leasing at of rate a $XXX X.X% we of same-store X.X XX%. XX% our the spreads million into of account asset leased Total synergies tenant taking million of retention expected leasing, Two, from almost portfolio our platform.

value our MOBs we’ll existing primarily scale we utilize operating additional to quarter. These in fourth the located shareholders. well-located in and platform closed our are drive million $XXX over where includes markets, This are adding for

larger for at we’re immediate competitive fit markets deals, that been yields Although to our have accretion. on allow but very one-off focusing able we in acquire where that opportunities the for portfolio, acquisition remain

HCA development. two of now We’ve with including four, called Dignity, announced Finally, $XXX million and redevelopments in new and CommonSpirit. developments on-campus developments XXXX,

relationships years with and the both strong with to future these of entities for have them We over work developments. continue

include We have in of our the of with of We’ve process total $XX that capital in County, million Viejo now investments St. up developments Orange MOBs will Campus XXXX. also Mission be delivered million announced that on Health over start to California, Joseph four investment. redevelopment $XXX in will to two

forward over on built fourth to basis deal We capital deploy next the Our availability XX% capital XXXX, take down to leverage given debt-to-EBITDA. are our down This never balance total of XX% times $XXX to the times us capitalization purposely next two X.X when been the in we stronger, the quarter with has months. available six quarters. capitalization million sheet the approximately and of five and goes in leverage a of this to of seeing expect flow factoring total and equity over in

– $X.XX we Note growth of in $X.XX teams. that Earnings in with per our were our from XXXX, more able share and costs acquisition normalized we expense. to and must costs associated HTA capitalized than operations were a that within activity, in-house share funds $X.XX were These now per to that our had our leasing the in performance grow result as fourth quarter.

a achieved that of From on drive focused re-leasing XXXX, to performance driving to while to that our using ahead XXX management by XXXX. XXX basis way XXX we HTA bottom asset is to an As in are growth occupancy we focused in maintain platform the on spreads points, hits perspective, – look line. continuing we

and focus platforms we’re place taking opportunities opportunities disciplined in our acquisitions on perspective, finding have criteria on to be continues an acquisition advantage key both our XX been that to our development and now increase closing for the through years. markets, our seeing development in meet that and now in From of five investment that

balance we on the forward a strong on a an sheet on balance perspective. from basis a an accretive with between X.X creative investing sheet and From times maintaining leverage raised equity focused – X.X perspective, times, we’re

reach a over guidance expecting share, of From $X.XX of share the X% $X.XX XXXX, range. at per of between to and FFO for growth per point the midpoint view we’re with normalize

We top expect achieve the between to to our of on for the range. focus side the X% to growing X% occupancy with year, range same-store growth a

We between will X.XX. fully deploy $XXX our equity existing with $XXX with for and year, X.X synergies acquisitions million of yields capital, the after projected to million expected

first to start color some of project in which our will the additional with being Cary, third will we Finally, comments. at in the give our delivered on his Carolina North quarter. Robert deliver developments, beginning

in of that operating report of Since we January. wanted we published on communities which was and Finally, efficiency our sustainability invest. the I our America’s Healthcare started to point in buildings we in in Trust XXXX, platform first focused the footprint our out have

now will the over I to call Amanda. turn

Amanda Houghton

new Thanks, part Scott. existing In efficiencies of integrating portfolio, in while XXXX, our results our team operating leasing on onto platform delivering remained anticipated the and and high-quality these capturing our acquisitions. properties focused as synergies and

in-house properties profits own and this most the and markups third-party the management and being XX XXXX to $X in team decade, and we our portfolio, the Over new our previously and $X yield, of platform. visible period, ability and of passed between our we repeatedly million, replacing has add bring basis managers. generated example which teams The with incremental as result a shown into of asset management last capturing points over engineering we largely Duke between the savings to our acquired third-party XX-month staff XX

third impact allows This perspective, they tenant parties. transition that see from net previously no in-house to as third-party our seamless platform financial benefit to profits to is our management from from on a passed shareholders

XXX benefit a HTA provides. leasing synergies company, believe, early full-service space staff operating platform REIT property remains We are in suited of our as over engineering With of savings the a across to XX over recognizing platform. in management, stages and uniquely we still and the the from the very full benefit offices,

we’re markets, at sense hire plumbing market, third more specialized electrical to square of in do additional feet services XXX,XXX example, mechanical, in a grow begins from and we staff to done standpoint. by and services skilled make in-housing to By way As cost previously the parties. able

With margin value continue investors key on for and expect continued next and over staff, platform. the markets creation focus see from our a will training three we years, four growing to expansion our in-house to

Turning quarter. the now fourth to

X.X% a year-to-date On this growth in X.X%, growth X.X%, came same-store and expansion. of at increased same-store revenue driven growth quarter growth revenue XXX margin by NOI base X.X%. driven Our basis, of rental points full-year by basis

new square feet square leases and During leases. the XXX,XXX renewals. approximately feet quarter, of feet X million we almost included signed This square of of XXX,XXX

roll of while retention signed total in at increasing same-store towards X.X%, for Our continuing portfolio we spreads continue as our Annual to our leases. period were the renewals re-leasing for X%, was trend leases escalators strong tenant XX%, X.X%. escalators remained on

per TIs term renewals square term year square year foot remained on of per of per per $X.XX at consistent on new. $X.XX foot and

now almost while re-leasing square our total the is leased million year portfolio spreads retention XX%, For for Same-store feet, renewals the X.X year, on we strong our or XX% have X.X%. are GLA. of

our our renewal quality to the new growth stream Further, and revenue on expect. leases those during X.X%, averaged increases signed recurring contractual year strengthening come investors and have

as early have Two in increases and year their notable level This tenants for related for in of driven they practices feet expire seen invest over the renewals, X our to in by a to note renewals XXXX consolidate trends leasing on long-term, their square leases of space million beyond. that we is to the seeking lock and infrastructure. with

our X.X seen their as trends We XXXX, higher years, are by in than These XXXX of renewal key tenants into evidenced lock of continue the years. XXXX believe real as nearly longer-term are to have will average renewals, increased estate trying in term both we delivery renewal average X.X healthcare positive also for in that an strategies. interest XX%, term

of to front, of specialty On expense our economies show we service and continue scale benefit the offerings. the

XXXX, offset Despite efficiencies able relatively overall fourth quarter, focus the the been utility expenses property in teams during over flat X% this to through continued our Texas, of impact keep were over our we in down have sequentially. For and primarily savings. an increase in to platform largely on taxes XXXX able quarter and

did quarter, of coming In tax in outcomes continue appeal to fourth will believe success see with our property efforts favorable we the we and quarters. the to some of our appeals, the begin have

internal quality great with We XX.X% ability average. into through is historical changing external portfolio in resiliency years the a expirations of to XXXX came reflection and XXXX of portfolio performance amount our our slightly of deliver of environments. our growth a versus continue than to NOI XX% higher past, and

had California. Orange XXXX we These and also fee-simple Viejo MOBs buildings lease. are included four Joseph Mission asset own which that the largest Viejo buildings, We in master Campus on coming several in medical hospital XX-year County, off Health constructed office of transitions, our St. were the Mission a

facilities the and modernize We’re with moving will redevelopment their above two significantly allow command current forward line us more rent on with to and in that buildings rent market. this

quarter, While which decrease percentage, fourth contributed occupancy leased of to over grew in points quarter year-over-year same-store in leased third overall an basis QX. rates XX.X% manifested was in remained the occupancy XX the these our steady and factors same-store to and much

XXXX, we in another X% we of As portfolio status. look to have month-to-month with our X.X% expiring, approximately

Given to current X% the with to discussions with expect in be retention tenant around we tenants, X% XX%, range. renewals spreads

leasing efforts of feet. with continue XX% comprised of strong new greater our than to deals XX,XXX large Our over square pipeline be

sign with levels see of of outlook through and next While to basis between second-half take XXXX, the XXX to we within these deals an and ultimately deals occupancy expect and months. to points leased towards do XX of moving these out, occupancy XX the XXX build increased longer overall meaningful benefits the generally

I Robert. turn now to over will the call

Robert Milligan

for with being level combined year front, active growth. earnings ended Amanda. Thanks, on growth, XXXX market to which our us very investment allowed an up accelerating capital us when and continued the demonstrate same-store of a

This performance fourth in the generated revenue both same-store of quarter, by our generated operating margin through expansion platform. full-year increased growth growth coming X.X%. X.X%, continues and to growth utilization we and with steady be consistent In same-store at of

the the capitalized million perspective, expensing increase of had in year-ago at quarter very X.X cost million, for period. internal with year-over-year coming leasing primarily with infrastructure which we efficient the by in in the driven From $XX.X remained G&A we an

For the million, at peers. $XX.X remains year, to extremely in efficient which we came relative our

normalized assets generate redeploying growth acquisitions, continue as generated in share sale we our quarter fourth on $X.XX, to last markets. year, close result, diluted up raised in X% year’s capital prior a the per better of from Greenville into same-store the we As and FFO and

for the distribution $XX.X approximately expenditures, which available quarter, increased XX% NOI. million includes $XX.X Funds recurring million or of of in capital

Our XX.X% year, rate remains run the for around of however, NOI.

we’ve leasing in normal, than given slightly of into close entered to portfolio amount higher completed or high XX% of is than the almost we CapEx XXXX. recurring relatively more XX% in Our total or XXXX our

We improvement continue utilization. XXXX, in given the into lag expect of will some this tenant

our an improved and allows shareholders. From capital we’re to investment lock number disciplined opportunities cost attractive increased underwriting criteria an of accretion that of for close meet one seeing in that perspective, us and an have day

For our over investments XXXX, on operating were $XXX close we from able million find including of at over to and synergies yields day one X.X%, platform. of

on including In mix the in closed owners investments, sales and we from million $XXX healthcare providers. quarter, fourth of developers, a private

Our on over XX of on healthcare estate years in remains high well demand, and the are critical straightforward, center by that continues locations. investment medical positioned criteria those core on- be as grow identifying to buildings, focusing off-campus as assets academic to mix next evolve, that as five delivery real to will

that can utilize markets than and where we and drive to platform scale our are faster yield relevancy our and to our in key where They’re increase growing U.S. can value additional we investments. average, assets located

on finally, day drive accretive And opportunities we’re returns, as focused growth. as one achieving long-term to well

and Our They increase the on a with locations on in were value opportunity we almost to opportunity performance. the located additional to XXXX is properties basis, XX% met core over our entirely fee-simple think criterias. rents. through these push key long-term in which The investments still time markets in while critical adjacent campus, an to occupancy were all of drive to critical acquired or all

more number square in construction to than feet markets grow a scale XX. that over we increasing From XXX,XXX to markets, with portfolio of perspective, continue our key

with groups As increased large our the systems, physician concentration, academic efficiencies health universities geographic operational we relevancy we as we brand improve and the gained and platform. leverage

is in is earnings lowly time ability in transactions philosophy in acquisitions raise always and turn to to pursue capital sheet where opportunistically. a we volatile accretively growth the and to are ensure accretion position true the quickly. we pursue remain especially make This to balance leveraged Our the and markets, we have lock

the financed our in than XXXX equity, that a million as raised dry XXXX. $XX.XX an including by quarter, average least implied acquisitions capital very and price. transactions a our than more lower head the of X our basis, serve cap in at We fourth as basis is in low acquisition XX rate powder million million for efficient for will We $XXX took at through approximately raising on $XXX ATM, prices around or allowing acquisitions we forward slightly which $XXX

given that we fourth are would of potential in and for pipeline in were the forward, have to number I market note a the the given we chose ways evaluating quarter, in of seen. the always which and the In election any can volatility that year raise we opportunities opportunities market. use equity

will gives dilution without a from This five the we times strength sheet raising equity us leverage earnings on basis, believe of something balance the immediate that by the be shareholders. a comes valued traditional

in billion growth maturities. and shape the As including X.X finance with debt-to-EBITDA, to year $X.X times We balance of be sheet forwards equity our liquidity, to near-term continues a XXXX. very the limited terrific at in result, ended

range the of In within When maturities $XXX factor these capacity we the third in the opportunity remaining quarter, we to our our leverage rates. times. liquidity X.X acquisitions, we at equity balance sheet at forward and targeted in took X over the by while very standing our million X.X into to times have debt-to-EBITDA, extend attractive

X% initial the X% Turning $X.X range $X.XX we earnings per of guidance have of $X.XX of guidance same-store normalized in high-end growth to grow achieve as $XX XXX shares flow will a Viejo, end the X.X% our of to they a of of utilization towards end redevelopment to in revolver the year; This the of Mission million cap increase of remainder equity resulting assumes second million our synergies; $X cash acquisitions our with the increasing share. XXXX, that positive of $XX with provided of that to the rate range including of FFO to G&A occupancy; of capital average and at the achieving to forward our quarter, capabilities as occupancy at on end platform to our approximately the million towards the by of million our to of blended million, is the the $XXX based our headwind million $XXX the XXXX. of on X.XX%, million we expectations with levels of financed result properties million, $XXX

which into higher we Our maintenance We to a leasing as to by for relatively heads XX% of in growth our year, capital we MOB the levels NOI, increase XXXX XXX increase XXXX solid slightly, to the CapEx as normal think we XXX will In expect HTA year return our will also be XXXX. could points year during from the the sector. see look occupancy you non-recurring in XX% total, position for levels growth XXXX. of of levels will basis should us into be to

over turn Scott. I to will now it back

Scott Peters

Thank you, you, Amanda. Robert. Thank

We will up questions. now for open

Operator

Tayo We [Operator begin first session. question Our Instructions] Please comes Okusanya from Mizuho. question-and-answer now ahead. go with the will

Omotayo Okusanya

afternoon, Hi. guidance same-store solid guidance. Question Yes. Good for around quarter, XXXX. great

of occupancy goal of higher? same-store kind NOI of points your that the basis increasing bit just XXX a guidance given surprised Just little isn’t

Robert Milligan

and pretty with. at I to the is should how certainly X% think MOB X% Well, should how consistent we perform, a that as going range out we we look sector think, perform we’re

the year. headwind bit will start, the year, which see end view – an occupancy third anticipate the to we slight first tailwinds of an certainly, by that the we into which first will is, carry Our quarter next into from from we carried occupancy that’s to of We’ll perspective, the saw quarter time lead occupancy little perspective the in a potentially to provide the a occupancy decline fourth. get

to how balance little of to from a a as relates perspective it there’s same-store. bit an So occupancy

Omotayo Okusanya

the overall But outlook you about then appreciate commentary of some of buy to transactions generally whether you’re acquisition could what big there’s a And versus things the where difference between helpful. I sort? your big of just and made off-campus and about kind talk market, on-campuses to That’s you there. trying Okay. other at kind rates looking again, are, acquisition out relative cap that

Scott Peters

Scott. is This Sure.

little mean buildings occupancy call and is group I think right building, compression if that, even but we’ve synergies, maybe a continues have rate location But cases, months that buildings, off-campus right tenant critical. right seen size what that and certainly and I size, the over of of to and the or single to, down, last than what we have by by a core certain think on-campus. traditionally XX has in the that, they the community quality even closer we the the come longer don’t a it necessarily seen cap been I get and

I core if if and seven far six, acquisition what healthcare, you feel years never seeing the we seeing, you’re think of if think look community you almost we you’re more closely ago. university but years future you on-campus brings, the We academic at started ago. look here, – started XX become I selective. know future And

something when going if or cooperative. healthcare demand be system think to used going was there to the able was to just and be and it’s buy fully be to on-campus, assume you the perform you I that to it buy going

now out the in I are systems greatest they mix. patient think the generate focused communities. They’re healthcare locations, into where focused can are

off-campus our what I where favorably, location a what we’ve traditional to situations, ownership seeing NOI from more compares called be been on-campus. peers not an or a and community favorably perspective, perspective, many have to And think if traditionally return core may an an situations, perspective from seen are used

and logical evolution communities on-campus only core those see are So, cities those out from back community to many these infrastructure you’re are key place expand, fact continuing reach for your back is or migration And pick key continue of core. and locations. key that of going the go you to to systems of into to to if cities those growing the to the community healthcare to services cities the I think the continued I and

on-campus we that. doing that breadth and setting. we’re we’ve to our in very the depth cities they’re So, in core see and with and acquisition can community happy some opportunities, continue both And got

Omotayo Okusanya

are bought rates kind the stuff what what But kind maybe fourth you those of of around, those relative assets to some in kind other of trading cap quarter? are for

Scott Peters

Well, thought of haven’t I portfolio XX think got that cap transactions rates haven’t on aggressive publicity. moved. maybe I we ago, I and seen. got frankly with lot ago a larger the months XX some cap rates extremely months

can And my so that little pricing therefore, take the assets one off was a backed bit. my individual of type asset perception that’s and or or that two

We’re about we be the like we this X.X% be finding, in as to balance opportunities good us very optimistic like and That execute. talked comments, that in allows where We’ve to fit finding that. very got we’re about Robert seems to we’re X.XX%, to disciplined strong and right and the sheet XXXX.

we right and So we where environment the like are we that now. frankly I see like

Omotayo Okusanya

Thank Great. you.

Operator

Bernstein with go Please next Our Daniel Capital ahead. question comes One. from

Daniel Bernstein

Hi. I and – occupancy guess a XXXX. follow-up question same-store to Tayo for the for on comp NOI the

like way year-over-year growth? X.X% the think the is right you be So X%, will the first-half that in about X% through into NOI right the it think be flows way year of second-half the Is roughly – in to then may that and to XXXX? and NOI about that the growth

Robert Milligan

occupancy in in of quarter, comparative range. the potential the the year-over-year X% certainly that has at little with first each just certainly to year. we target have periods occupancy that would quarters out, a same-store back-half as the growth be think look how our But shift headwinds, above our a I the the the get as revenue into to Well, given view of of first-half lines for you we think, bit the more I

Daniel Bernstein

XXXX over in benefit Okay. should some And growth XXXX? that no, growth, should see you acceleration year-over-year XXXX

Scott Peters

Yes.

that’s occupancy our got X% and this, starting it ourselves see where traction. X%. for in tried focused positioned leasing We where focused we on take at is, platform. to have think and same-store on forthright I think redevelopment we’ve some – the to to to look we’re We’ve occupancy like both pretty we’ve be we investors we XXXX with seeing and We’re we’ve

think some XXXX. up pointed in smaller large had her traction, done that have make Amanda they we’ve location. processes. want groups I larger the right They But as just seen by more does the by with they’d frankly, that who larger that be we comments, and is space, now. are it’s spaces the the catch spaces, And sure large to to fact If or a them, this out spaces adding

We’re seeing good activity.

we’re think, we perspective the excited some that repositioned we fact And gains. the is very I our where to pay we’re that So, can going assets. doing, about occupancy see development We’ve portfolio. dividends those pricing with and from are a

Daniel Bernstein

then terms know guided and that’s compressing rates fairly in you of or disposition size $XX seems – the if at number not. I that low is dispositions, Are But could you possibility demands to And MOBs, Okay. there a and changing of be with higher hospitals million. there are the as the well. as million of certainly portfolio? maybe $XX cap MOBs, the review slightly don’t only technology lower it

Scott Peters

Yes.

and were of fortunate. day I sort think the America. we to was we’re about I Healthcare talking of talking that someone other Trust

We’re years old. XX

So bigger. we’re on went as We’ve the the very we as we through our XX, XX is years diligent us as committee. of bigger a product and not last process frankly, got public now we’ve gone over years with seven. process investment huge gone quality we’ve public, and focus a XX and a And through old. far about There when been

for it’s whether buy, whether $X we billion. or that it’s acquisition every sees $X for a committee investment Our

every And in acquisition, you very assets. with But purposeful. then, not them, were cities. we go we dispose with assets that since going when selective to and been look They’re their put selective markets. done five So, the at we you you "Okay, – should five." in of dispose We’ve we’ve Duke we company our they’re something that our if that what There’s in we’ve portfolio. together like we They’re through of XX acquisitions those things fit the say, so say and don’t therefore, bought don’t disciplined. we our don’t been of

been We’ve diligent. very been disciplined. We’ve very

everything million Greenville sale right an on think right always say for at I $XX I the to probably have average at both we’ve said the parties. fortunate time we And But do continue it the for was the to that And so, is thought price. were to good and number. opportunity we that is

to if you somebody consider think came we that "Wow, we lease be just a assets do XX% is we don’t what if it and occupied. would. said, them I And bought them the that?" XX% bring about to and opportunity have should so, not about for we lot We platform like. But and again, don’t of like to What up they’re to our to value would

Daniel Bernstein

Thank Okay. I’ll floor. the you. That’s yield good.

Operator

Joseph next Please question Our Nick Citi. comes from with ahead. go

Nicholas Joseph

you’re what When onto Thanks. bake underwriting an you acquisition, an asset in putting typically for platform? additional benefit offering your

Scott Peters

that or immediate asset. everyone everyone, been management Traditionally, there gets that third-party but Well, platform third-party been certainly all in seen of – not or our bump. most cases, we’ve that has has there

And point we’re change most assets and we’ve operating. how don’t bring market doesn’t now, extra where because onboard. And people, in generate our a got got markets a on to cases it out in we’ve one them built two out in so, bring we huge we or in that built

In benefits. fact, brings synergies and it

the Duke last of the clear, three is proven certainly part so, years pretty distinct. pretty the acquisition. first And it equation And over with we’ve the

bringing But second own what assets. with, we job and about where is and managing services your focused what property more importantly investors better to and we’re X building engineers, a talked are benefits the to do services, are we’ve managers you need of XXX,XXX third-party we’re feet teams bringing When have them that the in-house. square we’re out that traditional now feet, square of million to on and

said, to benefits of bring building you people a and so office tenants?" number years, – what you the in medical that For is, can to put how One, you tenant consistent, you building, "Well, it can you a they’ve things. can two own that bring Well, that train, feels that you can systems, a can what consistency. got do processes put in do you make can

a a physicians and the You market, lot. because physician within groups talk reputation get

benefits faster. Amanda those of early do an can about from we’re perspective, do bringing and nice in have of people second, mean, it I them have we get that. the of doing quicker, thing, services bring in-house, it, course, But investor And, synergies that that’s talked our third-party those process it.

I left them of more and think, we we these processes. third-party services have years in-house from remove more and get can where

Robert Milligan

to the We us. of property in. that just benefits factored we’re rate the cap into rate management the fee do Nick, is coming additional the third-party thing that we cap be to haven’t disclosure, on see really year elimination the HTA factoring clear one but to And, beyond only that,

XX that the to come that included basis from XX in typically that it’s disclosure. So points the we’ve

Nicholas Joseph

expected very maybe That’s on that? more XXXX G&A, on the then, increase guidance. And what’s color us driving give Can you in helpful. just Thanks.

Robert Milligan

as as relationships there our an to talked I throughout think the we more leasing do lot to Scott expect as as grow that this those Amanda markets. dive build to more plan the we the platform, developments asset to bit grow the we about head the how we the as into leasing to and team perspective, we’ve it portfolio in looked people some of as in and and pay occupancy across and leads we occupancy a acquisitions sense expanded off our to other depths really from scale team management gotten a how and into get expect well year. makes a really depth of partly and year, It that relationships, We’ve well.

Nicholas Joseph

you. Thank

Operator

Chad with from Stifel. Vanacore next question go Please comes Our ahead.

Chad Vanacore

of target those going maybe about that I’m go to an Tayo your Dan on some that about improvement would different makes asked some a properties? specific you potential, direction. or idea XXX, Since us be trod of occupied think on might under occupancy, that me mentioned territory Amanda what some opportunities, maybe XXX give points basis right. All

Robert Milligan

at talked Well, for in and of portfolio, in our looked were I quarter we some them. larger we’ve things properties a come transition we’ve essentially the year, tenants acquired place. We think, of some as tenant certainly knew going out, way couple move to smaller from where tenants perspective, Amanda’s as the third to through there’s this make

So the decline occupancy we place saw the quarter. take third in

to get tenanted assets year, of of back course Now it same up. we many the expect through the those

properties we – of some they through Haven, in has lowly lower kind were Houston a gone she we’ve Charlotte New that that bought, well So more in mentioned in as this. little occupied, got we’ve some

Amanda Houghton

redevelopment expecting Mission so. And also to our we’re some there, gain campus, traction

Chad Vanacore

year, been? end your right. trending? how experience then And And – tax that what’s the been All is property of

Scott Peters

property are have we’ve as taxes sure certainly, about, I’m about talked and talked Well, a big other issue. folks

the go process any You property very and a peers. than appeal our actively value We can. buy tax diligent we different think through of and to revalued. and and through the is We something I gets don’t our any try we fairest get to go process it

an at So do do there’s it an do systems. when we synergies look we we of And acquisition. of issue. three and an We One, it at. four is look we that at acquisition, We location, tenants is an when look course, of when it things underwriting. or healthcare synergies

course, our have it’s so good a market, assuming, that of of we what We’re in is. pretty depth

are someone there for, is that can think an because get over probably I that or I and that you renewal. is you – when the a rate less based relative it’s overvalued, asset to rents, we get may the upon asking now on on overvalued it look rent roll can be think overvalued right cap you Second, at see

to in in over carefully that escalator So rent we rent. what see seven can growth the we at is It and the we next look can the years. very proportionate what see

the it’s that going them, at ability and through. the to the then And look or communication we going you year that property second third, renew, relationship relationship taxes, tenants, to own year something to the the it your eventually, re-lease, that’s first comes whether with impact you’re because is your

with with that both investment committee. significant internally, but our point, now is something is us also discussion a it So

Chad Vanacore

Any notable One quick thinking one. right. All expirations be XXXX in lease last about? a should year we

Scott Peters

Not use to But word tend to much. not ebbs of – consistent. square portfolio get I we’re with XX almost I million flows. you that pretty feet, mean, like a and

the are years want rolling. the when to occupant. diligent both of of We seven, right We We’re on sure it’s is the right TI make by amount now sure very leases and there. XX right want by right to us make tenant the grant, five,

taken we’ve XXXX. So,

focusing the in to as basis, a the in moving principles on organization bottom to on a one-off XXXX I decisions putting an are focused our bottom to mean, on up that in We’re diligently HTA. focused results of adds on basis, line but line. both cumulative play the the for we platform

Chad Vanacore

it from That’s right. All me. Thanks.

Operator

ahead. Siversky Our Please next go Berenberg. with Connor from comes question

Connor Siversky

Hey, all, thanks for having me.

Just execution generally a that of on a end, properties a in on modernization, that quick of any MEP or do question strategy project is terms case-by-case in terms the on you provide in need or renovation modernization? And color addressed follow redevelopment. you basis? preconceived identify Could each regard how strictly then, to maybe may you

Robert Milligan

think, we identify assets we find and lower assets within management annual go And of budgeting strategic asset and are our if of market. quality the as positioning kind I Well, through that typically, of we process, rent, our to our either at look for plans any pretty the and and a the opportunity go building a into have lower occupancy take increase that. for significant capital in rates, we’ll required but that evaluate or certainly hard

I about Amanda buildings, had coming Viejo, example. $XX, XX% below a some to XX%, were in those perfect could $XX, older in We has campus the be. is case, potential The leases. which where long-term this is, relative this talked probably rents Mission off think, buildings

there. typically the do Part identify we of more drive just overall be of that make is through process. to those did redevelopment within And going buildings part So do How the buildings? how becomes we improvements controls MEP. energy the we efficient, more improvements

Connor Siversky

people any increase Gotcha. anymore And the general, maybe and your terms area? development then bandwidth team to in of bring in plan on that in

Scott Peters

approach is unique so people great and is and Well, I always opportunity people. looking improve for career and an HTA add really we this to – mean, to think their competent, take come we’re forth. aboard a truly

we’re So to we specifically, add – for to as add do do need relates need to bandwidth? it our looking we and always or additional people but anyone

We’re pretty well-positioned.

looking at opportunities. always We’re

buildings want just build years We I We’re a building. going seven to development we that do or criteria. am with medical building?" then "Okay, don’t pre-leased want to our now to very it what mean, office fit I just don’t that have build to say, with want five and We do disciplined. a from and building

very opportunities. We’ve being got diligent. So we’re

to development. continue see We

relationships. been then continue The guess, XX with our around place We with timing existing it’s us opportunities years. more us And a year-and-half. the helped And to a to I for our size year, was Duke for pretty see now, We’ve also most good recognizable. acquisition. get of been XX, were where we

in And that “Okay, want to include to of, development, the you doing we’re completion development that’s the our we’re consider with discussion and introductions more done disciplined some develop. be you it, and place. to folks the like so, we’d of there’s and out of we’ll leads in opportunity we’ve again, already very good the what we there.” known a to And to But

Connor Siversky

Okay, thanks weekend, a good Have that. everyone. for

Operator

comes Our question Jonathan Raymond Please with ahead. from next Hughes James. go

Jonathan Hughes

of XX% at Good you hoping get was was up renewal the X.X% morning in If XX us to you but I there. out growth I retention. at occupancy, the could spreads quarter. bps, NOI same-store Hey. walk through progression the how down it look mid-X,

to the gets growth. mid-X% revenue you that So

X.X%? basis XXX points other this get does where Just to to from come

Robert Milligan

seen talked operating a we’ve year One, within throughout of I just the think our our things. it’s property, more combination normal the about, progression as of what platform. doing there’s we of

the we were was of year able – think, areas achieve one focus focus utility this I a we savings. about to on lot talked

we’ve gone of. additional through within saw pretty that certainly good the the some quarter we good margin we the got some out and pretty or buildings, gone and of As through teams improvements fourth recommissioned there increases certain

We some that came tax property also back. got appeals

refunds, we XX also valuations that basis there. as period, both we drove lowered assessments well where point, throughout we couple property the tax a benefit just XX, as received we XX were improvement appeals, of basis to And able go that another of had as $XXX,XXX point from where and get probably

Jonathan Hughes

Okay.

mean, if, mostly savings. expense is up have would the been NOI But built. if, X%, you I been mean, realize it’s that platform to part of didn’t if and say, had But I that expenses So closer I opportunity flatter have growth right? you like like say, X%,

Scott Peters

other three I been it’s up discount platforms. in our Well, from we’ve a portfolio. to as years, you last hard the have We’ve outperformed perspective. the – said, mean, expense expenses over Most peers

lower. Our We’ve platform of been has advantage that. actually taken

that. We continue to advantage can think we of take

fortunate advantage things. will So as forward. continue take to to be don’t these that I those it’s we have go that we think not able advantages of we

negative-negative, a I so know sort wouldn’t asking that. So how question of of to answer

Jonathan Hughes

Yes.

follow-up. then my Okay. one And

year. year ended last of started million $X with doing $XX dispositions, You expected the for up million

And of dispositions for of same-store definition expected with to in million million this all what’s intended expected Can $XX a as remind are in dispositions. to NOI held be sale? for property of the the adjustment requirement starting for south? classified the year you $XX You’re us sale

Robert Milligan

that kind definition to that The a qualify process Yes. four-step is for on simply it’s of that.

approval rationale and Board assets, have walk the impact we potential First, and what sell to so the Board have to the for why through that. to

we thing to it. have actively is, Second have marketed

to typically So sometimes shown a through it’s to taken on a being basis. direct process, to be sellers brokered market, got

to us to The on it to third – on to actually proceed a we for sale through and that. go we offer receive thing actually is, expect an have at that price

sale that of parts – various there’s that the have through of in and at look in only the out or that what’s there. you met bucket quarter, fourth for when PSA-signed properties criteria, get So, to both diligence gone intended the two

So very process a and, in fall it’s limited frankly, disciplined that to bucket.

Scott Peters

talked this both We diligences And our growth on a audit and as and disposition third-party have actually about to before. our process. due our you we’ve same-store know, signs-off committee

probably So perspective. internal the that from HTA associated I’ve diligent most from monitoring been criteria company is an that and consistency disciplined, with perspective, and

we wanted tend have to gone an we offer to leases re-trade get pay not to re-trade. where to them. decided sale, We for tried seen agree of for and where sell and We have we what and don’t to sell. has what for where got fruition have buy. and the to examples, we been have we’ve things opportunities, buy we has put through we up them, And a paid But there couple try folks tend – buyer situations, and come

And so, "Well, not what, something to said, then, going that’s we’re guess we sell."

investment where, reactive. as are we expect, you as I So make decisions, said, committees business would our

that basis decision we shareholders. the making are best we very cognizant on so, a can for of And consistent

Robert Milligan

of just thing, just that point. final kind the And on

would we have, gone intended pool, our think X.X% sale a look NOI and would included for I walk through if reported, same-store have same-store. I same-store We versus the we that X.X% into a actually had our if actually our up. properties growth think, you walk have

ways. So it’s defined it a both through and we that very process works go

Jonathan Hughes

Okay.

you And the PSAs I right? so said it’s disposition now, have $XX think for that guidance you right I million two mean, properties, million? $XX in

Robert Milligan

Yes. We’ve on those, yes. LOIs had PSAs or

Jonathan Hughes

Thanks for time, That’s All Okay. the guys. it me. from right.

Operator

next with Our question Anderson comes SMBC. ahead. from go Rich Please

Richard Anderson

Valentine’s Day. Happy and you, Thank

Scott Peters

it Yes, is.

Richard Anderson

in today. love for HTA air the There’s

Robert Milligan

love just It’s the just period. air, in

Okay.

Richard Anderson

much and escalator sure allow – I’m XXXX Amanda, the out in that’s leasing – of it? that how I’m duration so you lease and – in longer over part to you for mentioned longer seven seven get years. by it – if I’m of wondering guys more negotiation get is, you stay? and – you of wondering mentioned for granting part activity do bigger if you So a a that,

Amanda Houghton

re-leasing on contractual escalators? the on about talking the you or annual Are spread

Richard Anderson

annual contractual the escalator? On

Amanda Houghton

It’s the determined by market.

So near we typically annual growth the to try market. the in escalators have our

or don’t the a the roll we that have roll of down. significant end term, up lease So at

been X% regardless to X% around generally, we’ve that term. right the of So

Richard Anderson

Okay.

Scott Peters

the you’re groups, I the is just trying to more The there’s that the that negotiation. that in leases, And we situations, larger their that, in you – sort of healthcare larger some XX,XXX, cognizant is seen get feet, think though negotiate have space, larger escalator leases. do escalator. the smaller lot what a in get XX,XXX, opportunity recognize XX,XXX the the that’s square you than Rich, that larger the to systems today prominence quicker the on feeling market the

healthcare medical Medical in confident, very, something one is surprise. the is and that going system very a leasing on are office distant the market executives have that things a and Brokers think that longer what’s is that market. acquisition has office longer substantially expertise the I and asset both is knowledge changed no the no about market have of group. is in

Richard Anderson

Okay.

is But do has a this something you stock else last in going of much, nothing the XXXX, cost into as company course, better you profile more? as acquisitions your the conversation, growth in or in year was simply of of Clearly, there and it a and, of – much Is lot has much to influenced way more you year. else capital? drove XXXX, to did XXXX. So much external change capital the cost simple didn’t done this do that

Scott Peters

think mean, Well, be three and And needs to find I cost opportunities to there’s do first it I things. We foremost, accretive. need to capital. to that.

couple So assets? got below and Are very, are you where asking XXXX, on I that remember we comfortable we comfortable of for where for bidding are is, finding very one first of are the cap next rates that the XXXX, But is or first If is that part and other thought it portfolios. rates – steps a probably folks certain with aggressive cap foremost cap rates fact, one the down. are? we next

but it of what at themselves buy, they necessarily goodness. to a my out that started wanted rate a kind place all, got in aggressive where meet we and didn’t of therefore was they was, cap oh, First people

mellowed think out bit. little that’s a I

the rationality a I think markets we in that that that seeing. now with we’re acquisitions more are there’s the and in little

was it and talking were and going at I Robert to ended rates and thought where thought third, then, it XX-year one, cap cap where And it’s it that If rates XXXX, about, I he rate environment. back and can up find and four then, interest It’s was So to going But… to it we capital. assets. was cost the in-between. I look is to

Richard Anderson

Somehow, that one. Scott won

Scott Peters

traditionally, of don’t not works that like But. end we had I’m wrong but to I balance we they see – rates be the use interest think, Well, come. I to didn’t XX go anymore. the conversations mean, wanting management want big move were up, did rates Directors their teams, Rich. point. not maybe if years, or – up, I of sure was know. That’s a sheet. And go Boards was cap that about so last how projected that over on of that decision And a cognizant very to

Richard Anderson

Yes.

Scott Peters

they’re capital and interest our for is accretive to be I can while, that become something feeling think rates that rates consistent internally for. is to more the now that are find a going cap we probably cost acquisitions where

Richard Anderson

then expectation good how XXXX much much from any this see, makes does you last In external for your if if we Yes, And did growth me. sense? Thanks. words, How per stuff. growth other would your that share year, not guidance? nothing impact

Scott Peters

does, and It I’ll that. let answer Robert

Robert Milligan

Yes.

hit unable them, to low-end $X.XX, targets, think earnings think some we I frankly to our certainly higher-end the it’s deployed I If end our of to we range. of I capital, acquisition that end not the I of provided. closer we’re range into meet or If target $X.XX and our factored the we able and exceed think up that’s acquisition targets think, at we’re range.

Richard Anderson

the I the Okay. the the timing one What settle you, are course forward sort got of of And year? over you of Robert. more for assuming

Robert Milligan

Yes.

put diluted we – million in XX, or that estimates So the our around No, it right yes. settle earning would spread close of shares, put we has imply an so of June XXX year. which midpoint average that we it the to

Richard Anderson

very Thanks perfect. much. Okay,

Operator

comes Please Stender from Wells Fargo. Todd question with next go Our ahead.

Todd Stender

regarding Thank that the you. one My question on last piggybacks forward.

forward? look stock still can that��s the projected. ATM, have more you forward, at So have the How you right? – regular all relative in the using But you’ve tap kind you price equity now you what to could of maybe thinking price where But equity. when you than right that to the guidance your you about have balance you’re your for FFO you still good

Scott Peters

fortunate back go right the we’ll now. we’re to Well, –

I where it seeing I the on where back XXXX, to, in about We XXXX, year. to we started our shareholder to but it to actually are we wanted where back you value FFO on should ourselves getting We talked not focus the focus think, – put and last-half have be. think to in see we where those opportunities. we of growth and

in do position We’re that. to a

always I from are talk that, position at we’re successful what people try we we happens, now. when to if nothing think a us I to least else And we there in put to communicate them.

where seeing need that. think to is we year execute sheet XXXX leasing pipeline, balance our on just have, we’re with and in a decent we the a I do have, we job the opportunities what

we’re where well-positioned there other we opportunities we accretive, see we have our addition would FFO opportunities then if done, growth can it execute. to just of need would now, take that. are or right make we If and normally very make advantage we what in But to

Todd Stender

That’s Because little But you’re that coming you gets you, more helpful. assumes go the may and to Thank when forma your down fair look at new maybe? with it you just not debt-to-EBITDA forward, X% say at Scott. is incremental necessarily equities, that with a have to it to X%. going that pro X.X%, not to debt debt

Robert Milligan

Well, I the at it that assumes of we X:X range. stay what kind is think

we in as maintains equity to with. draw range our that X.X% So acquisitions, leverage make the that that we’ll X% down comfortable we’re

up that that But might raised. the important any got powder, the is have have year. come pursue pipeline we volatility We’ve already throughout is, opportunities the thing we this certainty see despite kind that the the acquisition do dry see the capital that of to we we and

So we in feel those. comfortable pursuing how we’re

Todd Stender

NOI CapEx are percentage XXXX, you. Thank when about right. your and for And thinking spread of last per recurring when a you. at look can FAD, some look you growth. at All the got CapEx away at that guys chew on just – that. How Thank you you the FFO Maybe share that maybe there between you’ve in about of a talk question, basis?

Robert Milligan

What a the XXXX. it, expect consistently. maintenance And outlined XX% of to it that in we to we XX% to case perspective we’ve we in from that would the, think be that call expect NOI, be

it is higher. when with see might tick start we little think you I go where a the associated with and associated to occupancy growth we actually start get higher that, if – the to opportunity that is capital if for bit to

a NOI kind one-time then on the and that’s of course, Of you item increase see basis. corresponding a

anything expect driven XX% XX% that occupancy above by we So with to really growth.

Todd Stender

you. Thank Okay.

Operator

from Sarah comes with ahead. question JPMorgan. Tan go next Please Our

Sarah Tan

on with Michael I’m – Mueller. Hi. for

terms additions of Just announcements, of two and pipeline dollars, recent I’m there a extensions on the the quarter? how question in you wondering you if development given to is have pipeline that made it shadow last extensions. big and is development the development a

Scott Peters

is, move transaction determined we portfolio. opportunities want – we or see because I Well, answer I our specifically, are to talk that do we haven’t been the them that we mentioned, or concluded. have have already hasn’t yes. We as about that inherent that to now forward in with, either discussions don’t to

that have we So do opportunity.

opportunities a there’s of and three new we to are "are are development Now competitive,” in major it’s with where or the there also right that are and do for it’s system the so looking that out healthcare looking two – more forth. us and market

but development months side those, like we now, we portfolio. that of – combination I in we a got control we’ve months, that months, to always those are the last our in have opportunities, to develop to success. do are the And XX feel have So opportunities taken find equation our of those – the we six own inherent XX

to the So onboard to help can tool we earnings. couple on adds we abilities of years, development bring our next certainly that have that with generate to that us the for that other

Sarah Tan

you. Thank

Operator

comes Advisors. from Hartwich go Lukas Green Street Our next with ahead. question Please

Lukas Hartwich

to how quoted? guidance it for yield and that long your think before do number you On to XXXX what takes you Thanks. acquisitions, the is get synergies

Robert Milligan

We to in we points typically in buy on that. XX markets basis we our XX typical that the baked achieve when

take of get third-party historically points synergies, only for like included straight synergies can I a cash So were to And elimination said, really we just property us those off management about to arm’s you what a had transaction. length the provided on XX fees. the are get basis

within that days the acquisition markets. a new first key happens XX So typically, in of our

Lukas Hartwich

Great. acquisitions? Do underwrite guys you other ever non-MOB then one. quick just one And

Scott Peters

be you more that? Can on clear

Lukas Hartwich

know housing? of your that nursing, you Just estate, in skilled portfolio. I other segments a have senior guys of healthcare smattering real

Scott Peters

I do. mean… We

Lukas Hartwich

curious if new just deals? I’m you underwrite

Scott Peters

we Well, you I them. try we whole knowledgeable – be sector we I that we can. possibly to healthcare don’t think that about tell as would as underwrite the are

spaces it, greater be expertise that I’d I be. externally, transactions we to than But tune with step have we and whole If the actually as happen those do and do. you say that far back try don’t across can buy as internally in possibly

thing, does Caroline same the Amanda. Robert,

Vice some Our six, they’re leasing the been Presidents what now of seven They very Senior us in – Leasing, people with we’ve five, mostly have got years. experienced. our we teams, call

what So not transactions we are where of much try ourselves are going or to the what and marketplace keep transitions systems on. may aware going, in very be healthcare may

Lukas Hartwich

you. Thank Perfect.

Operator

Malhotra next Please ahead. Morgan Stanley. go with question Vikram Our comes from

Vikram Malhotra

the How the dispositions? I’m seems in that to Thanks questions. for taking for have sale. to in $XX asset $X.X $X.XX relate Robert, just does they’re you so just numbers. baked million were assuming they like intended to related, – clarify, but the million seem million different it

Robert Milligan

I million the to a getting $XX a a given rate, think it out dispositions we things think a is Scott that as will bit put We close, of market – difference of translates process what little handful the run that closes. we through. here. given ultimately mentioned normal there’s in our go Really, to there this experience ultimately

Scott Peters

XX It’s months.

Vikram Malhotra

Well, let’s sound in say would million $X NOI volume? like more disposition

Robert Milligan

NOI. intended you’re taking I’m not sure Oh, with sale… of million the for $X our

Vikram Malhotra

annualizing, Just yes.

Robert Milligan

things weigh If in than things there increase I go corresponding you’d saying. that I Yes, there’s on think that. understand in what guidance. see expected you. in ultimately acquisitions think got we a dispositions probability that, higher disposition close that I I a you’re the –

think sale in our with bucket, that intended reporting remain I sale for properties I would for same-store important growth, lower. are we try is all you in the look same-store at the think be as included not we Again, guidelines. intended though, and the the to the thing there, higher we consistent conservative if had

Scott Peters

I’ll think, I And just…

Vikram Malhotra

just volume on means more $XX No, not focusing than wondering $X I’m lot the no, million. a growth. NOI I’m million

So the for sale? sell over to what I’m timeframe wondering looking like you are intended just

Robert Milligan

in being dispositions the see up on cap that. that think we’d I No, the ends Yes. rates

a a I we’re perspective, I we range, think the X.X%. from to it kind in being in midpoint put that, we increase I X% think, kind of there up think And acquisitions ends than But type ultimately of just the giving expect again, a see if happen. you’ll X% guidance of will what corresponding higher

Vikram Malhotra

Okay.

high cap really So deals? be rate they could

Robert Milligan

is plus this is rates in us we’re million $X.X the X% just or transact the I us you’ll No. minus increase what you’ll acquisition see you cap see range doing. No, annualized, if have would on that that I say, think see us and range

Vikram Malhotra

operating I’m and with the but up going synergies still that then clarify the Okay, building folks. got platform baked day – you in, make are management just synergies to sure you to And asset it. out getting the just you the one, I is want also referenced today G&A and you’re leasing

to So is wondering, one I’m – pieces, got to fair day I do it over just you’ve different as opposed time? guess they’re that synergies but assume

Scott Peters

said, can Robert as XX one, Well, it there’s just now, you days. traditionally the two buckets. One third-party, you pointed take is, day And it get asset, they out, you’ve when Robert come where off. there’s in goes take and away, away a XX-day our they away platform. and because go them notified maybe an you and buy on the people to go But third-party the transition,

contract rebudget bucket marketplace when the or within our the second quarters our the take where onto put contracts tend the that The their the is, of that year put be on. we to we engineers, see couple throughout much managers to they’re than contracts service or our throughout put next favorable that on the property opportunity more asset we we

or one-off their representation developers with at square owning feet is Typically, million local not not business property smaller management, is market. X the their national that or business XXX,XXX assets to

that bundle. can that’s the we I get. mean, So we opportunity

benefit year the we not to at services that. me, get continue to of to then retail and that more we we and benefit So provide tend tenant we and that away wholesale, half and retail, get then one year then and probably get at we steps after in get excuse there second the are right get the the first – the two more and to the second one continue in we benefit

Vikram Malhotra

closure? close. St. underwrote Okay. is And sort an an briefly of experience, given have know you in you talked about talk then by. you about potential how MOB And kind have close to and but Vincent there, this. I you deciding any on-campus, Can takes MOB just last of I original one. your Robert, transaction? you and the puts either the But or L.A. closed Downtown don’t

Robert Milligan

made the L.A. in year Downtown is earlier we This Third Yes. acquisitions this that Street. in

we’re underwriting is is long-term for perspective, What is just is submarket? at an one submarket looking that always demand That healthcare? the is what the market? For the What exploding.

real all at from there something If and go years the Downtown the estate the years. XX a perspective you of seen investment expect next and taking you’ve place, like $XX billion five, L.A. that’s last over five investment look over in

growing. So it’s area really an that’s

of seeing incomes lot the You’re a up. come

that really And like the the competitive a hospital. straight that their in affiliated with patients that from practices and a wanted tenants attract that actually we like so, actually healthcare of just asset, we in It’s none From perspective. are from ability demographic to area there. to with – a perspective be

So is, increase but when not looked underwriting, at perspective, practices as saw did from their demand value of to building the going where we physicians understood really that our from, and were an it we the that in and there. getting that just continue area it demand where was

time, see because at was moment. door as next actually, we if didn’t being the at being additive the hospital negative the So anything a that

Now thing hospital benefit. going as is, actually the interesting – to we’re if closes, the likely

subject ground not leases. We’re to

fee-simple totally interest. We’re

we and into the our that actually are some space on-campus looking building. might of see tenants for them are come And

see we’d fundamentals out, the time. point impact. not at playing where if no outperforming in see our of thought we So we underwriting We immediate slightly this long-term be

Scott Peters

Yes, the the tenants, location major it. We’ve reinforce. to asset all I it’s in assets This before see went would UCLAs location, just some to I got bought I expand. is building. buy. tenancy, they the we we and want location,

about. and at five talking occupancies I type up that valued of This it to three, or next building to though I here I what be is months, what what for because XX%. the valued at it’s where bought what going going XX%, it’s which get at look asset is a love now, and to in Amanda more today guided XX%, our lot we’re portfolio. to from in is guided It at XX%, could a investors X%, X% our see we full had wish at think, at it, of we be years couple

to But you’ve got look. go

a that out case, from If when than in been problem. it ground would we’ve But sure. hospital, it. make had of our checked we and boxes, underwriting it better have have to that on-campus would the got is You’ve bought ahead particular would have occupancy If been with leases, the been problem. a we this and it’s turned

Vikram Malhotra

Thank you. great. Okay,

Scott Peters

one bringing So thanks up. for that

Operator

This would the for I Scott conference session. turn concludes like our Peters any question-and-answer over to to closing remarks. back

Scott Peters

as very can next very or we Thank or much. excited we’re and know conferences be you folks I next some as weeks. and three two that in about the many there up look we talking to month XXXX. thank there to are Well, you. coming We’ll forward

Operator

concluded. today’s attending has Thank conference you for now The presentation.

You may now disconnect.

Healthcare Realty Trust (HR) 15 Feb 202019 Q4 Earnings call transcript