Canada Pension Plan Investment Board and HCN Form Joint Venture in Portfolio of Medical Office Buildings in Southern California

TORONTO, ONTARIO and TOLEDO, OHIO--(Marketwired - Aug. 4, 2015) - Canada Pension Plan Investment Board (CPPIB) and Health Care REIT, Inc. (NYSE:HCN) (HCN) announced today that they have formed a 45%/55% joint venture to hold a portfolio of medical office buildings in Southern California. The joint venture will initially own a 50.5% interest in the portfolio and the seller, who contributed the portfolio in exchange for a mix of operating partnership units and cash, will retain a 49.5% ownership stake. It is expected that the joint venture's stake will increase to 100% if/when the seller converts their operating partnership units into HCN stock or cash. The entire portfolio is valued at US$449 million.

The portfolio comprises eight medical office buildings totalling 437,875 square feet, with the majority of assets located within the Golden Triangle district of Beverly Hills, California, a premier medical office market with attractive supply and demand characteristics. The remainder of the portfolio's assets are located in the San Diego and Los Angeles markets.

"This acquisition marks our entry into the health care real estate sector, a growing and compelling subsector within the real estate market. With an aging population and increasing demand for health care, we view the U.S. health care real estate sector as an attractive long-term investment," said Peter Ballon, Managing Director, Head of Real Estate Investments Americas. "We are pleased to be entering into a joint venture with HCN, a well-aligned partner with a proven track record and tremendous expertise. We look forward to expanding the relationship with HCN through additional transactions in the sector."

"We're excited to be partnering with CPPIB, one of the most sophisticated real estate investors in the world, on their first health care real estate investment. Our goals are well-aligned and we believe there are strong growth opportunities for the partnership," said Tom DeRosa, CEO of HCN. "CPPIB provides HCN with a stable, alternative capital source to the public markets across all economic cycles. We have built an unparalleled network of relationships with leading health systems and senior care operators that enable the evolution of health care delivery for an aging population."