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Ventas details debt investment in Blackstone life-science properties

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Ventas details debt investment in Blackstone life-science properties

made a $140 million secured-debtinvestment in life-science properties owned by Blackstone Group LP, company executives said April 29.

The investmentwas in a secured junior loan tranche linked to class A assets principally in Cambridge,Mass.; San Francisco; and San Diego, company Chairman and CEO Debra Cafaro saidin a conference call, calling the deal "intriguing." It made up the bulkof Ventas' $154 million in investments in the first quarter.

Blackstoneacquired BioMed RealtyTrust Inc. on Jan. 27 in a roughly $8 billion transaction.

Cafarocalled the Ventas investment "a great investment on a stand-alone basis,"adding, "Great sponsor in Blackstone, and this was the core, kind of the bestof the Biomed real estate, this tranche of the financing."

She calledlife-science properties "a good asset class," but not a "must-have"like properties in the medical office segment.

"Underthe right circumstances like we found here, if there's an opportunity to make areally good investment, we'll do so," she said.

Pressedfor further details by Citi analyst Michael Bilerman, Cafaro added: "We havea great relationship with Blackstone, who we admire greatly, and we also have agood relationship with your firm, that was involved in the financing."

"Thiswas really an opportunity that was presented to us that we think was a great risk-adjustedreturn," she said, citing the "very, very prime" quality of the assetsand the company's pre-existing knowledge of the life-science segment.

Ventas'investment is in "a lower tranche" in the capital stack, with a loan-to-costratio "in the high 70s," Cafaro said.

WhenBilerman asked whether the investment represented a potential entry point for alarger transaction, Cafaro replied: "Wow, you have an overactive imagination!But I like it. I would say that this is a good stand-alone investment that we made."