Charles A. Sammons (Baylor) Cancer Center
Savills Studley advised Duke Realty Corporation (NYSE: DRE) on the capitalization for the to-be-developed Charles A. Sammons (Baylor) Cancer Center located on the campus of the 1,002-bed Baylor University Medical Center (BUMC) in Dallas, TX. BUMC is part of Baylor Health Care System, the leading health system in North Texas.
The property consists of a 465,000 square foot, 10-story class A outpatient cancer facility and medical office building, along with a 250-space garage. It was developed by a wholly-owned operating division of Duke, with a total development cost of approximately $155 million. The building was 93% pre-leased with major tenants including BUMC and U.S. Oncology, the nation’s premier oncology services company.
During the complex capitalization process, numerous issues arose, including accounting issues with the hospital, environmental issues and an inconsistent building size / tenancy throughout the process.
Due to the size of the development, Savills Studley worked to access the debt and equity markets simultaneously. REITs, pension funds and advisors, equity funds, investment banks, public and private companies, and life insurance companies were all evaluated.
By the end of the process, 16 equity investors and 15 construction lenders executed confidentiality agreements and received the offering memorandum. A major insurance company was selected as Duke’s partner in an “all equity” transaction.
Joint Venture Equity Raise