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 Related Quotes
 Medical Properties Trust Inc  5.13   0.29  5.35%
 Enter Symbols: 

Medical Properties Trust, Inc. Announces New Lease Agreement for Six California Facilities


Stabilized Cash Rent of $45 Million Annually


Competition for Operations Results in Value $10 Million in Excess of Stalking Horse Bid

BIRMINGHAM, Ala., Aug. 28 /BusinessWire/ -- Medical Properties Trust, Inc. (the "Company" or "MPT") (NYSE:MPW) today announced a lease agreement with NOR Healthcare Systems Corp. ("NOR") in conjunction with NOR's successful bid for Prospect Medical Group's ("Prospect") California operations. The transactions are expected to close in 2025, subject to approval by applicable regulatory agencies.

The six facilities will be subject to a master lease with initial annualized rent of $45 million, virtually identical to Prospect's once-scheduled 2025 rent, and CPI-based annual rent escalators beginning in 2026. All rent will be deferred for a period of six months, and 50% of rent will be deferred for an additional period of six months, after which the aggregate deferred rent will be paid over the remaining lease term. MPT has committed to fund up to $60 million in seismic improvements as may be required by California regulators over the next four years, which will increase the lease base and result in additional rent at the prevailing lease yield.

Edward K. Aldag, Jr., Chairman, President and Chief Executive Officer, said, "The additional $45 million of annual cash rent expected from these facilities adds to the more than $1 billion of pro rata annualized cash rent we expect from our current portfolio by the end 2026."

Aldag continued, "Significant competition among multiple capable operators to purchase the operations of these infrastructure-like facilities reflects their history of EBITDAR profitability."

About Medical Properties Trust, Inc.

Medical Properties Trust, Inc. is a self-advised real estate investment trust formed in 2003 to acquire and develop net-leased hospital facilities. From its inception in Birmingham, Alabama, the Company has grown to become one of the world's largest owners of hospital real estate with 392 facilities and approximately 39,000 licensed beds in nine countries and across three continents as of June 30, 2025. MPT's financing model facilitates acquisitions and recapitalizations and allows operators of hospitals to unlock the value of their real estate assets to fund facility improvements, technology upgrades and other investments in operations. For more information, please visit the Company's website at www.medicalpropertiestrust.com.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements can generally be identified by the use of forward-looking words such as "may", "will", "would", "could", "expect", "intend", "plan", "estimate", "target", "anticipate", "believe", "objectives", "outlook", "guidance" or other similar words, and include statements regarding our strategies, objectives, asset sales and other liquidity transactions (including the use of proceeds thereof), expected re-tenanting of facilities and any related regulatory approvals (including the closing of the transactions described in this press release), and expected outcomes from Prospect's Chapter 11 restructuring process. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results or future events to differ materially from those expressed in or underlying such forward-looking statements, including, but not limited to: (i) the risk that the NOR transaction will not receive required regulatory approvals; (ii) the risk that the timing, outcome and terms of the bankruptcy restructuring of Prospect will not be consistent with those anticipated by the Company; (iii) our success in implementing our business strategy and our ability to identify, underwrite, finance, consummate and integrate acquisitions and investments; (iv) the risk that previously announced or contemplated property sales, loan repayments, and other capital recycling transactions do not occur as anticipated or at all; (v) the risk that MPT is not able to attain its leverage, liquidity and cost of capital objectives within a reasonable time period or at all; (vi) MPT's ability to obtain or modify the terms of debt financing on attractive terms or at all, as a result of changes in interest rates and other factors, which may adversely impact our ability to pay down, refinance, restructure or extend our indebtedness as it becomes due, or pursue acquisition and development opportunities; (vii) the ability of our tenants, operators and borrowers to satisfy their obligations under their respective contractual arrangements with us; (viii) the ability of our tenants and operators to operate profitably and generate positive cash flow, remain solvent, comply with applicable laws, rules and regulations in the operation of our properties, to deliver high-quality services, to attract and retain qualified personnel and to attract patients; (ix) the risk that we are unable to monetize our investments in certain tenants at full value within a reasonable time period or at all; (x) the risk that the operations of our tenants will be negatively impacted by changes to Medicaid funding introduced by the OBBBA; and (xi) the risks and uncertainties of litigation or other regulatory proceedings.

The risks described above are not exhaustive and additional factors could adversely affect our business and financial performance, including the risk factors discussed under the section captioned "Risk Factors" in our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q, and as may be updated in our other filings with the SEC. Forward-looking statements are inherently uncertain and actual performance or outcomes may vary materially from any forward-looking statements and the assumptions on which those statements are based. Readers are cautioned to not place undue reliance on forward-looking statements as predictions of future events. We disclaim any responsibility to update such forward-looking statements, which speak only as of the date on which they were made.

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