East Texas Medical Office Building Portfolio
Category: Medical Office Buildings
East Texas Medical Office Building Portfolio is a ten building portfolio consisting of multi-tenant and single-tenant MOBs located in Longview and Marshall, Texas. Longview is a city of approximately 120,000 residents that is located near I -20, a major east/west Interstate, and is approximately 130 miles east of Dallas and approximately 55 miles west of Shreveport, Louisiana. Marshall is a small city, also located near I-20, consisting of approximately 25,000 residents and is located 23 miles east of Longview. The Portfolio consists of five buildings located on the Good Shepherd Medical Center – Longview campus, one building, GSHS Outpatient Clinic, adjacent to the campus, three off-campus properties designed as free standing outpatient clinics and the Marshall Professional Building which is across the street from the Good Shepherd Medical Center – Marshall campus. Each building is associated with Good Shepherd Health System the dominant system in both markets with a 55% market share in Longview as well as an 80% share in Marshall.
Combined, the Portfolio totals 399,266 square feet and is currently 98.2% leased to 43 tenants. The Portfolio has 76.1% of on-campus or campus adjacent space and the entire Portfolio is either on-campus or affiliated with Good Shepherd. The Portfolio is structured that three buildings comprising over 230,000 square feet (57.6% of the total square footage) are multitenanted with full service gross (FSG) leases and a variety of escalator structures including CPI capped at 3%, fixed dollar amount escalators and step up increases. The remaining seven properties comprised of 169,000 square feet (42.4% of the total square footage) will be subject to single tenant leases with Good Shepherd that have 10 to 15 year terms, are triple net in nature, with rental rates per square foot ranging from $7.50 to $20.00 and annual escalators of CPI capped at 3%. Combined, the weighted average lease term of the Portfolio is approximately 8.7 years.