Broadstone Net Lease (BNL) has announced its decision to divest its clinically-oriented healthcare properties, with contracts already in place for approximately half of them. This strategic move aligns with BNL’s focus on core net lease assets within the industrial, retail, and restaurant sectors.
According to BNL’s fourth-quarter 2023 results announcement from their headquarters in Victor, NY, the identified assets for sale do not typically fall under single-tenant net lease portfolios. These include clinical facilities as well as surgical and traditional medical office buildings.
These types of properties often have shorter lease durations and require greater landlord responsibilities compared to other net lease assets. They also pose potential challenges such as longer downtime upon lease maturity and difficulties with tenants. However, they may be attractive investments for specialized healthcare property investors but can prove challenging in the broader net lease market.
Overall, BNL plans to sell 75 healthcare properties which make up about 7% of their total portfolio value. Contracts have been executed on 37 of these properties valued at a combined $253 million while others are still being sold at varying stages.
After completing these sales transactions, BNL will retain consumer-centric medical facilities that are typical among publicly-traded net-lease REITs such as plasma centers or dialysis clinics without significant regulatory risks involved. Additionally,the remaining healthcare portfolio will consist of essential real estate fundamentals critical to tenant operations.
