LIMA, OH-Grubb & Ellis Healthcare REIT Inc., formerly known as NNN Healthcare/Office REIT Inc. has acquired the Lima Medical Office Portfolio for about $26 million. The nearby St. Rita’s Medical Center sold the six facilities, which total 193,000 sf.

Five of the buildings are near or even attached to St. Rita’s, a facility that serves a 10-county area and is affiliated with Catholic Healthcare Partners.. The other building is in downtown Lima. The closeness to the hospital was the prime selling point for the buyer, says Danny Prosky, VP of acquisitions for the REIT. “St. Rita’s is the dominant hospital here,” he tells “Plus, as part of a $130 million expansion, they’re adding 90 beds and opening up a brand-new, nine-story patient tower.”

Some of the space in the buildings are office condos, owned mostly by the doctors who practice there. “In four of the buildings we own them 100%, and the other two we have less,” Prosky says. The leasable space is about 80% occupied, he says. “We bought them at an attractive price, we don’t assume we’ll lease them up quickly. We’ve got a four-year lease up period planned. Most of the vacancy is in one building, the newest of the six.” The ages of the properties range from 3 years old to the Downtown building, which was constructed in the 1920s.

The average lease range, Prosky says, is between $9 for the downtown building and $14 on the hospital campus. Fourteen of the leases, about two-thirds of the rented space, expire in 2012.

Prosky says medical office today is still a much-secure asset, not subject to the rise and fall of the overall economy. “The need for medical real estate continues to grow because of the aging population,” he says. “However, with the growth comes more competition, including institutional buyers. Fortunately, there’s more and more real estate becoming available.” PJ Camp and Laca Wong with Shattuck Hammond Partners represented St. Rita’s in the sale.

Following the merger of Grubb & Ellis into NNN Realty Advisors Inc., the new company changed the name of its NNN Healthcare/Office REIT Inc. to Grubb & Ellis Healthcare REIT Inc. The company has made 16 other geographically-diverse acquisitions valued in excess of $340 million.

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