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[IMGCAP(1)]SANTA ANA, CA-The Securities and Exchange Commission has declared the registration statement effective for a $3.3-billion initial public offering by Grubb & Ellis Healthcare REIT II, which will be a non-traded REIT, according to a statement by the Santa Ana-based company. The new REIT intends to use the proceeds from the offering to invest in “a diversified portfolio of real estate properties, focusing primarily on medical office buildings and other healthcare-related facilities,” according to its statement Wednesday.The $3.3-billion offering will include up to 300 million shares of its common stock for sale at $10 per share and up to an additional 30 million shares of its common stock for issuance under its distribution reinvestment plan at $9.50 per share.

[IMGCAP(2)]According to its prospectus, the REIT “will seek to acquire a diversified portfolio of real estate properties, focusing primarily on medical office buildings and healthcare-related facilities, such as assisted living facilities, skilled nursing facilities, hospitals, long-term acute care centers, surgery centers, memory care facilities, specialty medical and diagnostic service facilities, laboratories and research facilities, pharmaceutical and medical supply manufacturing facilities and offices leased to tenants in healthcare-related industries.” The REIT may acquire properties either alone or jointly and also may originate or acquire secured loans and other real estate-related investments, the prospectus says.

Management of the new REIT includes Jeff Hanson, its chairman and CEO, and Danny Prosky, its president and COO. Hanson is also an EVP with Grubb & Ellis Co. and president and chief investment officer of Grubb & Ellis Realty Investors LLC. In addition to his post with the new REIT, Prosky is EVP of healthcare real estate with Grubb & Ellis Realty Investors LLC.

The prospectus for the new REIT, while listing a host of risk factors, says that management of the new REIT believes that increased demand for healthcare services “will continue to create a substantial need in many regions for the development of additional healthcare-related facilities, such as medical office buildings, clinics, out-patient facilities and ambulatory surgery centers.”

The prospectus cites a number of other reasons that investments in healthcare-related properties “could potentially offer a more stable return to investors compared to other types of real estate investments,” including the recession-resistant nature of healthcare-related real estate rents and valuations, which “are less susceptible to changes in the general economy than general commercial real estate.”

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