RMR Group Lands $272M Refi for LA MOB Portfolio
Morgan Stanley and BNP Paribas provided the financing.
On behalf of its managed joint venture, the RMR Group Inc. has facilitated a $272.1 million interest-only mortgage financing secured by two medical office buildings at 8631 and 8635 W. Third St. in Los Angeles. Morgan Stanley and BNP Paribas provided the financing.
The loan has a two-year initial term with three one-year extension options and bears interest at one-month Term SOFR plus 180 basis points. Proceeds from the financing were used to repay about $267 million of existing mortgage debt scheduled to mature in February 2027 and to fund closing costs.
Previously, the portfolio was financed with a CMBS loan, in the pool CEDR Commercial Mortgage Trust 2022-SNAI, according to Yardi Matrix. The same source records a $109 million sale from PGIM Real Estate to The RMR Group in May 1997.
READ ALSO: Is an MOB Makeover the Right Remedy for Your Space?
The collateral consists of two 11-story Class A, LEED Gold medical office buildings totaling about 330,000 square feet with two parking structures on the Cedars-Sinai Medical Center campus. Cedars-Sinai and its affiliates are the portfolio’s anchor tenants, occupying about 60 percent of the portfolio’s total rentable square feet. The buildings are connected to Cedars-Sinai Medical Center by skybridge.
The portfolio is owned by a joint venture for which RMR provides asset and property management services. The venture’s primary owners are private institutional investors, and RMR client Diversified Healthcare Trust owns a 20 percent equity interest.
Hogan Lovells Cadwalader US LLP was legal counsel to the lenders and Sullivan & Worcester LLP was legal counsel to the borrower.
MOB sector gets even healthier
Lending activity in the MOB sector has accelerated alongside the recovery in capital markets, as total MOB loan origination grew 88 percent year-over-year in the first half of 2026, according to a mid-year update from Cushman & Wakefield.
Southern California recorded approximately 10 percent medical office rent growth over the past five years, placing it near the middle of the national rankings, according to Cushman & Wakefield. However, the region ranked among the highest nationally for average triple-net rents, at approximately $31 per square foot, alongside Northern California.
Just yesterday, Commercial Property Executive reported on an offer by TKO to acquire the hospitality portfolio of The RMR Group–managed Service Properties Trust for $2 billion. As of June, the portfolio included 93 hotels totaling 21,110 keys.
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