Easterly Government Properties Completes Acquisition of VA - Jacksonville, the Final Acquisition of the 10 Properties in the VA Portfolio

Rhea-AI Summary

Easterly Government Properties (NYSE: DEA) has completed the acquisition of VA - Jacksonville, a 193,100 sq ft outpatient facility in Florida, through its joint venture. This marks the final acquisition in a portfolio of 10 properties leased to the Department of Veterans Affairs under 20-year firm term leases. The VA - Jacksonville facility offers primary and specialty healthcare services, including a domiciliary for veterans requiring additional care.

The completed VA Portfolio comprises 1,214,165 leased square feet across 10 properties in various states, with an average lease term of 19.6 years. This acquisition aligns with Easterly's focus on Class A commercial properties leased to the U.S. Government and supports its external growth strategy. With this addition, Easterly now owns 94 properties totaling 9.2 million square feet, either directly or through its joint venture.

Positive

• Completed acquisition of 10-property VA Portfolio, enhancing DEA's government-leased real estate portfolio
• Long-term leases with 19.6-year weighted average term, providing stable cash flow
• Expansion of total property portfolio to 94 properties and 9.2 million square feet
• Strategic focus on mission-critical facilities supporting the Veterans Health Administration

Negative

• None.

Insights

Financial Analyst

The acquisition of VA - Jacksonville marks a significant milestone for Easterly Government Properties, completing their 10-property VA Portfolio. This strategic move strengthens DEA's position in the government-leased real estate sector. With 1,214,165 square feet of 100% leased space and an average lease term of 19.6 years, this portfolio provides stable, long-term cash flows. The focus on VA facilities aligns with the growing demand for veteran healthcare services, especially in Florida, which has the third-largest veteran population. This acquisition should enhance DEA's revenue stability and potential for growth, making it an attractive option for investors seeking exposure to government-backed real estate assets.

Healthcare Facilities Expert

The VA - Jacksonville facility is a important addition to Easterly's portfolio, offering comprehensive services including prosthetics, physical therapy and traumatic brain injury treatment. The inclusion of a domiciliary for homeless veterans and those requiring substance abuse treatment addresses critical needs in the veteran community. With over 1.4 million veterans in Florida, this 193,100 square foot outpatient facility is well-positioned to meet high demand. The 20-year firm term lease ensures long-term operational stability for the VA and consistent returns for Easterly. This acquisition aligns with the trend of expanding outpatient services, which can provide more efficient and accessible care compared to traditional hospital settings.

REIT Analyst

Easterly's completion of the VA Portfolio acquisition demonstrates strong execution of its external growth strategy. The company now owns or has interests in 94 properties totaling 9.2 million square feet, significantly expanding its footprint in government-leased real estate. The focus on Class A properties with long-term leases to the U.S. Government provides a defensive position in uncertain economic times. The VA Portfolio's 100% occupancy and predominantly 20-year firm term leases offer predictable cash flows, which should appeal to risk-averse investors. This acquisition likely improves Easterly's tenant diversification within the government sector, potentially reducing concentration risk. Investors should watch for any impact on the company's balance sheet and dividend coverage ratios following this significant expansion.

WASHINGTON--(BUSINESS WIRE)-- Easterly Government Properties, Inc. (NYSE: DEA), a fully integrated real estate investment trust focused primarily on the acquisition, development and management of Class A commercial properties leased to the U.S. Government, announced today that it has, through its joint venture (“JV”), completed the acquisition of the previously announced 193,100 leased square foot outpatient facility leased to the Department of Veterans Affairs (VA) located in Jacksonville, Florida (“VA - Jacksonville”). VA - Jacksonville is the final property to be acquired in the previously announced portfolio of 10 properties 100% leased to the VA under predominately 20-year firm term leases (the “VA Portfolio”).

As part of the VA’s mission, the Veterans Health Administration (VHA) serves as the largest integrated healthcare network in the United States. VA - Jacksonville supports veterans within the surrounding region through primary and specialty healthcare services including prosthetics, physical therapy, occupational therapy, traumatic brain injury treatment, and rehabilitation medicine. The facility also features a domiciliary which provides housing to veterans who are otherwise homeless, require substance abuse treatment, or need additional full-time care. Over 1.4 million veterans reside in the State of Florida, representing the third largest veteran population in the nation.

“The Department of Veterans Affairs provides mission critical support for our nation’s military heroes, and we are proud to facilitate its healthcare service capabilities through the acquisition of this asset,” said Darrell Crate, Easterly’s Chief Executive Officer. “With the completion of the 10 property VA portfolio, we continue to execute on our external growth strategy and remain well positioned to deliver value for our shareholders.”

The VA Portfolio is comprised of the following 10 properties, arranged by lease commencement date:

Property Name	State	Leased SF	Leased	Lease Term (Yrs)	Status
VA - Chattanooga	TN	94,566	100%	15.0	Delivered (Nov. 2020) / Acquired (Nov. 2021)
VA - Lubbock	TX	120,916	100%	20.0	Delivered (Dec. 2020) / Acquired (Oct. 2021)
VA - Lenexa	KS	31,062	100%	20.0	Delivered (May 2021) / Acquired (Oct. 2021)
VA - San Antonio	TX	226,148	100%	20.0	Delivered (Aug. 2021) / Acquired (Dec. 2021)
VA - Birmingham	AL	77,128	100%	20.0	Delivered (Nov. 2021) / Acquired (Apr. 2022)
VA - Marietta	GA	76,882	100%	20.0	Delivered (Dec. 2021) / Acquired (May 2022)
VA - Columbus	GA	67,793	100%	20.0	Delivered (Jan. 2022) / Acquired (July 2022)
VA - Phoenix	AZ	257,294	100%	20.0	Delivered (Feb. 2022) / Acquired (Nov. 2022)
VA - Corpus Christi	TX	69,276	100%	20.0	Delivered (Nov. 2022) / Acquired (Sep. 2023)
VA - Jacksonville	FL	193,100	100%	20.0	Delivered (Nov. 2023) / Acquired (Aug. 2024)
Totals		1,214,165	100%	19.6(1)

(1)

Weighted average by leased square foot.

As of the date of this release, Easterly owns, directly or through the JV, 94 properties totaling 9.2 million square feet.

About Easterly Government Properties, Inc.

Easterly Government Properties, Inc. (NYSE:DEA) is based in Washington, D.C., and focuses primarily on the acquisition, development and management of Class A commercial properties that are leased to the U.S. Government. Easterly’s experienced management team brings specialized insight into the strategy and needs of mission-critical U.S. Government agencies for properties leased to such agencies either directly or through the U.S. General Services Administration (GSA). For further information on the company and its properties, please visit www.easterlyreit.com.

This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by their use of terms and phrases such as “believe,” “expect,” “intend,” “project,” “anticipate,” “position,” and other similar terms and phrases, including references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, but are not limited to, those risks and uncertainties associated with our business described from time to time in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K filed on February 27, 2024. Although we believe the expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurance that the expectations will be attained or that any deviation will not be material. All information in this release is as of the date of this release, and we undertake no obligation to update any forward-looking statement to conform the statement to actual results or changes in our expectations.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240903677088/en/

Easterly Government Properties, Inc.

Lindsay S. Winterhalter

Senior Vice President, Investor Relations & Operations

202-596-3947

ir@easterlyreit.com

Source: Easterly Government Properties, Inc.

FAQ

What is the size and lease term of the VA - Jacksonville facility acquired by Easterly Government Properties (DEA)?

The VA - Jacksonville facility acquired by Easterly Government Properties (DEA) is 193,100 leased square feet with a 20-year firm term lease.

How many properties are in the VA Portfolio acquired by Easterly Government Properties (DEA)?

The VA Portfolio acquired by Easterly Government Properties (DEA) consists of 10 properties, totaling 1,214,165 leased square feet.

What is the total number of properties owned by Easterly Government Properties (DEA) after the VA Portfolio acquisition?

After completing the VA Portfolio acquisition, Easterly Government Properties (DEA) owns 94 properties totaling 9.2 million square feet, either directly or through its joint venture.

What services does the VA - Jacksonville facility provide to veterans?

The VA - Jacksonville facility provides primary and specialty healthcare services, including prosthetics, physical therapy, occupational therapy, traumatic brain injury treatment, rehabilitation medicine, and a domiciliary for veterans requiring additional care or housing.