Central Texas Rehabilitation Hospital
700 West 45th Street
- 59,258 Sq Ft
- Available Space
- Not available
- Contact Broker
JLL is pleased to offer for sale the fee simple interest in Central Texas Rehabilitation Hospital (“CTRH”, the “Property” or the “Hospital”), a 50-bed rehabilitation hospital operated by a joint venture between Seton Healthcare Family (“Seton”) and Kindred Healthcare, Inc. (“Kindred”) under a long-term absolute net lease. Kindred is a leading operator of post-acute hospitals, nursing centers, home health, hospice and non-medical home care locations throughout the United States with over 2,700 locations. Seton is an operator of Seton Medical Center Austin (“Seton Hospital Austin”), the largest hospital in Austin and a network of 15 hospitals and 100 clinical sites. Seton is a member of Ascension, the nation’s largest not for profit and Catholic healthcare system (“Ascension”). This offering is a rare opportunity for an investor to acquire the only Inpatient Rehabilitation Facility (“IRF”) in Central Austin operated in joint venture with Seton. The IRF is situated near the flagship hospital of Seton, the leading health system in Austin, Texas. Seton and Kindred, one of the leading U.S. operators of post-acute services, own the Tenant through a joint venure. The joint venture creates a meaningful strategic and economic alignment between two market leaders for the coordination of patient care. The investment offers scale in net operating income through a long-term lease with contractual annual rent escalations and additional land for expansion.
Stable, Long-Term Absolute Net Lease Investment • Absolute triple net lease to a joint venture between Kindred and Seton • Desirable 10 years of remaining lease term with extension options and contractual annual rent escalations • Kindred corporate guarantee of its pro rata share of lease • Fee simple, offered free and clear of debt • Lease includes a tenant expansion option for a 40-bed, 49,974 SF long-term acute care hospital and three-level structured parking garage to accommodate future growth Market Leading Operator and Health System Partner • Kindred is the largest U.S. post-acute care operator with more than $7 billion in annual revenues • Seton is the largest health system in Austin with 15 hospitals and 1,733 licensed beds • Kindred is well-regarded for its quality outcomes — above industry standard discharges to the community, low readmission rates and superior functional improvements while under care • Opportunity for future relationships with Kindred as it aggressively grows its post-acute platform frequently through joint ventures and the use of third-party developers Critical Post-Acute Healthcare Facility • IRF in a high barrier-to-entry urban area with strong market share providing more intensive therapy than less acute settings • Joint venture with nearby 447-bed Seton Medical Center, the largest acute care hospital in Austin, provides critical alignment for patient referrals and outcomes • 2 hospitals with 33,687 annual patient discharges within a 5-mile radius provide critical referrals for admissions Urban Downtown Infill Location Within Desirable, Growing Austin Market • Above average population growth combined with significant residential and commercial development has led to surging land values in downtown Austin, creating a high barrier-to-entry and high growth in replacement cost • Located adjacent to new 206-unit, high-end seniors housing development • Austin commercial office rents have spiked reaching over $60 PSF in neighboring downtown