Sale of Arizona hospital finalized

Arizona General Hospital in Mesa is under new ownership.

Dignity Health, a subsidiary of CommonSpirit Health, has purchased Arizona General Hospital and seven freestanding emergency departments from Medical Properties Trust, one of the world’s biggest owners of hospital real estate.

Dignity Health is acquiring the properties in a $160 million deal, the organizations said in a news release. The organizations announced the transaction has been finalized this week.

Arizona General Hospital is a 50-bed hospital in southeast Mesa. The hospital includes 14 emergency room beds, four operating rooms, and a full onsite laboratory, Dignity Health says.

The freestanding emergency departments are based in the greater Phoenix area.

Medical Properties Trust said it plans to use the proceeds from the sale “to reduce debt and for general corporate purposes.”

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The company initially financed the construction of the hospital and emergency facilities for the original operator, Adeptus Health, for $92 million. After Adeptus filed for bankruptcy protection in 2017, Dignity Health took over management of the properties and leased the facilities.

Dignity Health operates 41 hospitals and many other clinics, urgent care centers and other facilities in 22 states. Dignity Health recently agreed to sell two hospitals in San Francisco to UCSF Health in a $100 million deal.

Medical Properties Trust has been leasing land to Steward Health Care, which has filed for bankruptcy and is trying to sell its 31 hospitals.

Medical Properties Trust has been struggling financially. The company reported a $664 million loss in the fourth quarter of 2023, and said the losses were primarily related to Steward’s troubles.

In the first quarter of 2024, Medical Properties Trust reported a net loss of $736 million.

Edward K. Aldag, Jr., chairman, president and CEO of Medical Properties Trust, said the company has provided Steward with $75 million to continue caring for patients and maintaining operations. He also said he hoped Steward’s bankruptcy filing would lead to “an orderly transition of Steward’s operations to new operators.”

In April, Medical Properties Trust announced it was selling the bulk of its interest in five hospitals in Utah to a newly formed joint venture. CommonSpirit Health, through a subsidiary, is leasing the Utah properties.

CommonSpirit acquired five Utah hospitals from Steward Health Care in a deal last year, but Medical Properties Trust owned the real estate, making CommonSpirit a tenant of the company.

Medical Properties Trust leases hospital real estate to 436 facilities in nine countries.

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