Dallas, Texas-based Rainier Medical Investments has launched the Physicians First Fund, a $10 million physician-only investment fund that will provide capital to acquire and develop medical facilities including medical office buildings, ASCs and hospitals.
The fund will provide initial project acquisition capital, in many cases as a bridge to longer-term financing or a sale and is intended as a "first in, first out" fund, says Tim Lavender, president and principle of RMI.
"Sometimes in order to grab a deal before others with more money get to it, you have to have readily available cash," says Mr. Lavender. Participation in the fund will allow investors to enter into desirable projects early. The acquired medical properties can then be refinanced or sold outright or placed into a larger portfolio at a profit, he says,
The fund will use this strategy, along with a consolidation strategy — where $200 million-$300 million worth of property is combined into a portfolio and then sold to a REIT at a premium — and an outright purchase strategy — where the fund holds its facility investment and receives the cash flow it generates.
RMI charges an annual management fee to investors in return for actively managing the fund. In addition, RMI will receive a percentage of the fund's excess cash flow after payment of a preferred return and return of capital to investors. Preferred returns and cash distributions will be paid quarterly to investors.
Learn more about RMI.
The fund will provide initial project acquisition capital, in many cases as a bridge to longer-term financing or a sale and is intended as a "first in, first out" fund, says Tim Lavender, president and principle of RMI.
"Sometimes in order to grab a deal before others with more money get to it, you have to have readily available cash," says Mr. Lavender. Participation in the fund will allow investors to enter into desirable projects early. The acquired medical properties can then be refinanced or sold outright or placed into a larger portfolio at a profit, he says,
The fund will use this strategy, along with a consolidation strategy — where $200 million-$300 million worth of property is combined into a portfolio and then sold to a REIT at a premium — and an outright purchase strategy — where the fund holds its facility investment and receives the cash flow it generates.
RMI charges an annual management fee to investors in return for actively managing the fund. In addition, RMI will receive a percentage of the fund's excess cash flow after payment of a preferred return and return of capital to investors. Preferred returns and cash distributions will be paid quarterly to investors.
Learn more about RMI.