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MPW Case Study – Springstone Texas

Author: Published on: Published in: Medical Properties Trust NASDAQ:MPW

February 7, 2023 – In Q2 2022, MPW committed $34.6m in funding for a new facility in McKinney, Texas, which would be leased to Springstone LLC. MPW did not disclose that the site was also purchased from Springstone, who already lease 18 facilities from MPW.

It is unfathomable that MPW has committed $34.6m on the development of the Springstone facility given the estimated cost of development and market value of the development was only $17.5m as of July 2022. MPW purchased the land from a Springstone subsidiary more than 6 months before the deal was announced for $2.95m, a sum that is not included in “costs incurred”.

The cherry on top: MPW owns 49% of Springstone. It appears MPW is round tripping cash even between their own off-balance sheet JVs.

 

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