Carter Validus Mission-Critical REIT II went on a buying spree in March, acquiring five properties totaling 362,000 square feet of fully occupied, leasable space worth $141.5 million, including a massive data center in Connecticut, according to a press release.
The Norwalk Data Center, bought for about $60 million from Fortis Property Group, is the largest of the REIT’s newly acquired properties, with 75,000 square feet of data center space, 30,000 square feet of office space, and about 60,000 square feet of supporting infrastructure. Cervalis, a subsidiary of CyrusOne—a publicly traded data center REIT—leases 100 percent of the facility.
The other properties acquired are healthcare facilities, one in Aurora, Illinois, and three in Texas.
“We believe these acquisitions represent our commitment to invest in high-quality real estate in the growing data center and healthcare industries. We further believe the critical nature of these buildings to the tenants that occupy them, along with their favorable locations and property conditions make them attractive acquisitions for CV Mission Critical REIT II,” said John E. Carter, CEO of CV Mission Critical REIT II, in a statement.
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Unlike data center REITs that trade on the stock market (CyrusOne, Equinix, Data Center Realty, etc.), neither Carter Validus Mission-Critical REIT nor Carter Validus Mission-Critical REIT II are publicly traded. Investors can, however, purchase shares directly through the company.
Michael A. Seton, President of CV Mission Critical REIT II, commented, “We believe acquisitions like these align well with our high-growth, net lease, mission critical investment strategy, and anticipate that they will translate into added value for our stockholders.”
Moving forward, management’s goal for Carter Validus Mission Critical REIT II, Inc., formed in 2014, is to continue to build its portfolio and assets. However, the company is reportedly looking to split its data center and hospital assets in its other investment trust and sell each separately.
The 20 or so data center assets could fetch more than $1 billion, sources said. They include data centers occupied by IO in Arizona, Internap and Atos data centers in Texas, an Infocrossing data center in New Jersey, and AT&T data centers in California, Tennessee, and Wisconsin. Together, its data center and hospital assets could value the entire REIT at $3.5 billion or more, according to Reuters.