Shares of
Medical Properties Trust
plummeted after the real estate investment trust said it is ramping up efforts to recover uncollected rent and outstanding loans from its largest tenant.
Medical Properties stock dived 31% to $3.46 in Friday trading. Over the last 12 months, shares have fallen 72%.
In a news release Thursday, the company said the tenant—Steward Health Care System—owes about $50 million in rent as of Dec. 31 and is continuing to make partial monthly rent payments. According to the release, “significant changes to vendors’ payment terms” have affected Steward’s liquidity.
According to Steward’s website, the Dallas-based healthcare system operates more than 30 hospitals across Arizona, Arkansas, Florida, Louisiana, Massachusetts, Ohio, Pennsylvania, Texas, and Utah.
Steward is considering a few strategic options, according to the release, which include selling or re-tenanting some hospital operations. It is also looking for a third-party capital partner for its managed care business, the release said. Steward couldn’t immediately be reached for comment.
Medical Properties said it has agreed to defer some of Steward’s rent for 2024 and that it will fund a new $60 million bridge loan. It has also hired financial and legal advisors to help collect rent, the REIT said.
Such uncertainty has left one Wall Street firm feeling hesitant. Despite
Medical Properties Trust’s
efforts to improve its balance sheet, KeyBanc analysts lowered their rating to Sector Weight from Overweight on Thursday.
“Visibility into the company’s earnings trajectory remains low and we are moving to the sidelines until there is better clarity around unresolved tenant challenges and balance sheet health,” the analysts wrote.
Write to Emily Dattilo at [email protected]
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