Medical Properties Trust Inc.’s inventory fell 29% on Friday after the real-estate funding belief stated one among its tenants, Steward Health Care System, is $50 million behind in lease funds.
Medical Properties Trust’s inventory
MPW,
closed at $3.55, down $1.45, its lowest stage since since 2009.
The inventory additionally drew at the very least one downgrade from an analyst on Friday.
The REIT stated late Thursday that it’s taking fourth-quarter noncash prices of about $350 million, together with $225 million to jot down off consolidated straight-line lease receivables, in addition to its $25 million share of straight-line lease receivables associated to the unconsolidated Massachusetts partnership and consolidated unpaid lease receivables of roughly $100 million.
“No assurances can be provided that further impairment of real-estate and non-real-estate assets will not be taken with MPT’s fourth-quarter 2023 reporting,” the REIT stated.
Medical Properties Trust is anticipated to report fourth-quarter outcomes on Feb. 1.
The REIT stated it’ll speed up its efforts to recuperate uncollected rents and excellent mortgage obligations from Steward, which lately knowledgeable MPT that its “liquidity has been negatively impacted by significant changes to vendors’ payment terms,” the corporate stated.
The transfer by MPT comes a couple of month after Steward stated it’ll shut down New England Sinai Acute Long-Term Care and Rehabilitation Hospital in Stoughton, Mass.
Steward cited persistent low reimbursement charges for providers paid to Medicare and Medicaid sufferers, based on a press release reported by Boston25 News.
“Nearly 75% of Steward hospital patients are public-pay, which chronically underpays, sometimes at rates less than the cost of delivering services,” the assertion stated.
A spokesperson for Steward didn’t reply to an e mail from MarketWatch.
MPT has employed Alvarez & Marsal Securities LLC as its monetary adviser to help with choices for recovering the lease.
MPT stated it agreed to fund a brand new $60 million bridge mortgage that’s “secured by all MPT’s existing collateral” plus new second liens on Steward’s managed-care enterprise, subordinate solely to Steward’s asset-based lenders.
Meanwhile, KeyBanc downgraded MPT to sector weight from chubby on account of “uncertainty and ongoing risks” to its tenant well being that “remain an overhang.”
“Management is pursuing steps to improve its balance sheet, which we view favorably, but pricing and execution remain uncertain,” KeyBanc stated.
Visibility into the corporate’s earnings trajectory “remains low and we are moving to the sidelines until there is better clarity,” KeyBanc stated.
In the third quarter, Steward accounted for about $70.7 million, or roughly 23%, of MPT’s complete income of $306.58 million.
Prior to Friday’s strikes, MPT’s inventory had fallen 59.6% prior to now yr, in contrast with a 23% rise by the S&P 500
SPX.
Dallas-based Steward Health Care describes itself as the biggest physician-led, minority-owned built-in healthcare system within the U.S.
Tomi Kilgore contributed.
Source web site: www.marketwatch.com
