COIT DALLAS, TEXAS BAYLOR SURGICARE ANCHORED MEDICAL OFFICE IN THE BOOMING DALLAS MARKET BUILT IN 2009 100% LEASED Holliday Fenoglio Fowler, L.P. acting by and through Holliday GP Corp a Texas licensed real estate broker ( HFF )
COIT EXECUTIVE SUMMARY HFF, as exclusive advisor, is pleased to present the opportunity to acquire the 100% fee simple interest in Coit Medical Center (the Property or Project ), a 32,201 rentable square foot best-in-class medical office building in the vibrant Dallas market. The Property is strategically located just off the campus of Medical City Dallas Hospital and minutes from Texas Presbyterian Medical Center, two of the largest and most highly regarded hospitals in all of Texas. The Property is 100% leased with Baylor Scott & White Health (Moody s: Aa3) anchoring the Project with 51% of the net rentable area. Coit Medical Center provides an investor with stable and dependable cash flow, as well as future income enhancement and ease of management via contractual NNN rent increases in one of the premier medical office markets in the U.S. The Property is located within immediate proximity to Medical City Dallas Hospital (796 beds; 0.1 miles), Medical City Children s Hospital (156 beds; 0.1 miles) and Texas Health Presbyterian Hospital Dallas (888 beds; 2.8 miles). Other hospitals in the immediate area include Kindred Hospital of Dallas (110 beds), Green Oaks Hospital (106 beds) and HealthSouth Rehabilitation Hospital (60 beds). PROPERTY OVERVIEW Property Address 12230 Coit Road, Dallas, TX 75251 Size 32,201 rentable square feet Percent Leased 100% Year Built 2009 Site Area 1.36 acres Floors 2 Weighted Average In-Place Rent (NNN/Year) $24.40 Weighted Average Market Rent (NNN/Year) $27.00 Percent Below Market Rent (Current) 10.7% Weighted Average Lease Term 7.3 years Parking Ratio 4.91 : 1,000 RSF 2
COIT Institutionally Anchored by Baylor Surgicare Baylor Surgicare at North Dallas Baylor Surgicare at North Dallas is a joint venture between USPI and Baylor Scott & White Health. The facility focuses on offering a high quality, service oriented environment, is staffed by 24 doctors, contains six operating rooms and is accredited by The Joint Commission. State of the art equipment allows surgeons to perform procedures in the specialty areas of Brachytherapy, Colon and Rectal, ENT, General Surgery, GI, Gynecology, Ophthalmology, Orthopaedic, Pain Management, Plastic Surgery, Podiatry and Urology. This location is one of 30 ambulatory surgery centers in the Baylor Scott & White Health system. Tenant Square % of Remaining Expiration Footage Property Lease Term Baylor Surgicare at North Dallas 16,356 50.2% Jun-25 8.8 Years Greater Dallas Orthopaedics 6,363 19.5% Oct-21 5.2 Years Legacy Heart Care 5,167 15.8% Dec-21 5.3 Years Texas Orthopaedic Surgical Associates 2,165 6.6% Feb-25 8.5 Years Lester Plastic Surgery 2,150 6.6% Sep-22 6.1 Years Total 32,201 100.0% 7.3 Years Executive Summary 3
Institutional Quality Medical Office Investment Developed with the mission of delivering the highest quality healthcare services, Coit Medical Center is one of the most desirable medical office buildings within the trade area. The Property is a best-in class-facility leased to Baylor Scott & White (Moody s: Aa3) and several other highly regarded specialty healthcare practices that specialize in orthopaedics, plastic surgery and cardiology. Long-Term Tenant Commitments and Substantial Tenant Capital Investment A tenant at Coit Medical Center through June 2025, Baylor Surgicare at North Dallas has invested an estimated $4.5 million ($275 per square foot) in their leased space, as well as adding their own elevator, placing the Property among the top-quality medical office buildings in all of Dallas. Baylor operates a state of the art modern ambulatory surgery center offering six operating rooms. The remaining tenants in the Property also provide high acuity services such as cardiology and orthopaedics and thus have highly upgraded spaces, in which they have invested substantial capital leading to a high likelihood of retention at lease expiration. Additionally, the Property boasts a weighted average remaining lease term of 7.3 years to well-respected national and regional tenants in the healthcare space. This stability, combined with 2009 construction, reduces the need to invest capital in the Property in the near future. Significant Discount to Replacement Cost Coit Medical Center is expected to trade at a significant discount to replacement cost (estimated to be in excess of $500/ SF) providing an extremely rare opportunity for an investor to acquire a high quality core profile medical office building in a top US market at an attractive basis. Medical office rents, currently $27.00 on a NNN basis, would need to nearly double to justify new construction. Prominent Location & Strategic Hospital Proximity Coit Medical Center is positioned at the convergence of Lyndon B. Johnson Freeway (I-635) and North Central Expressway (US 75) along the major thoroughfare, Coit Road. With over 1,800 hospital beds within a three mile radius, demand at the Property will remain robust as medical office tenants look to capitalize on the strength of the North Dallas. Superior Demographic Fundamentals Coit Medical Center offers an investor the opportunity to acquire an asset located in an area with some off the strongest demographic and economic profiles in the nation. Dallas occupied the #3 spot on Forbes list of the fastest growing cities in the U.S. in 2016, which factors in estimated population, job and gross metro product growth. The Project draws patients from some of the city s most desirable residential areas including Preston Hollow, Lake Highlands and the Park Cities. 4 Executive Summary
COIT DOWNTOWN DALLAS (888 TOTAL BEDS) PARK CITIES NORTHWEST HIGHWAY PRESTON HOLLOW ROYAL OAKS COUNTRY CLUB LAKE HIGHLANDS (952 TOTAL BEDS) (HOSPITAL CORPORATION OF AMERICA) FOREST LANE FOREST LANE COIT ME RI TD RI VE COI T ROA D AY C H U R C H IL L W Executive Summary 5
COIT Investment Advisors Evan Kovac 858.812.2365 ekovac@hfflp.com CA Lic. #01750736 Todd Savage 469.232.1930 tsavage@hfflp.com TX Lic. #509026 Andrew Milne Senior Real Estate Analyst 858.812.2370 amilne@hfflp.com CA Lic. #01868031 Trent Jemmett Real Estate Analyst 858.812.2363 tjemmett@hfflp.com CA Lic. #01982473 Philip Mahler 312.300.7319 pmahler@hfflp.com NY Lic. #40MA1012852 Michael Bennett 312.528.3694 mbennett@hfflp.com IL Lic. #475.155213 Ben Appel Director 484.532.4214 bappel@hfflp.com NJ Lic. #0903289 Capital Markets Advisors Zack Holderman Director 858.812.2350 zholderman@hfflp.com CA Lic. #01434957 Jeremy Sain Director 469.232.1904 jsain@hfflp.com TX Lic. #630806 2016 HFF and HFFS (HFF Securities L.P.) are owned by HFF, Inc. (NYSE: HF). HFF operates out of 22 offices nationwide and is a leading provider of commercial real estate and capital markets services to the U.S. commercial real estate industry. HFF together with its affiliate HFFS offer clients a fully integrated national capital markets platform including debt placement, investment sales, equity placement, advisory services, loan sales and commercial loan servicing. For more information please visit hfflp.com or follow HFF on Twitter @HFF. HFF has been engaged by the owner of the property to market it for sale. Information concerning the property described herein has been obtained from sources other than HFF and we make no representations or warranties, express or implied, as to the accuracy or completeness of such information. Any and all references to age, square footage, income, expenses and any other property specific information are approximate. Any opinions, assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that used by a buyer. Buyers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change.