DaVita Dialysis

Overview

Inherent to the DaVita’s operations are the reality that chronic kidney disease (CKD) is market sector experiencing growth. Given the fact that patients must make trips to dialysis centers on a routine basis, from a tenant perspective there will be revenues associated with the demand per building location. Additionally, the nature of their services includes customized equipment installations for each facility. This results in further assurance for net lease investors to see renewed leases at the end of each term. With the rising number of senior citizens in the American economy, the American Journal of Kidney Disease has presented statements concerning chronic kidney disease awareness. Therefore, anticipating the growing need for new dialysis centers continues to be projected. In particular, sample projections taken amongst all individuals above thirty years of age are quite telling. Statistical analysis shows expected increases from around 13 percent to 14 percent by 2020, then upwards of 17% by 2030.

Lowest Cap Rate

4.48%

Lowest cap rate over past 24 months

Average Cap Rate

5.85%

12 mo avg with 5+ yr lease term

Average Property & Lease
Average Sale Price $3,000,000 - $5,500,000
Average NOI $100,000 - $225,000
Building SF 7,500
Lease Term 15 Years
Escalations 10% Every 5 Years
Stock Symbol NYSE:DVA
CREDIT RATING
S&P

BB

Moody's

Ba2

Tenant Description

Founded in 1999, the name DaVita means ‘Giving Life’ in the Italian language. Davita, Inc. has corporate headquarters based in Denver, CO. They are focused on health care, and more specifically the human kidneys by providing dialysis services to patients. From hemodialysis, nocturnal and peritoneal dialysis, whether administered at a patient’s home or within their own locations, they will also offer renal diet support, vascular accessibility services, while educating patients on chronic kidney disease treatment.

Serving close to 200,000 patients at nearly 2,500 outpatient centers for dialysis, DaVita has grown to become one of the largest CKD treatment providers in the U.S., reaching Fortune 500 company status. Out of those centers, approximately 139 are internationally based.

PROS
  • Availability of NNN leasing
  • Company guarantees
  • Situated close to complementary healthcare services
CONS
  • Leasing again may prove costly if tenant relocates
  • Landlord accountability for building costs with NN leases
COMPANY QUICK STATS
Founded 1979
Headquarters Denver, Colorado
Number of Locations 2,816
Revenue $11.62 B
Company Website https://www.davita.com
Key Principal Javier J. Rodriguez

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