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United States securities and exchange commission logo
July 3, 2023
R. Steven Hamner
Chief Financial Officer
Medical Properties Trust, Inc.
MPT Operating Partnership, L.P.
1000 Urban Center Drive, Suite 501
Birmingham, AL 35242
Re: Medical Properties
Trust, Inc.
MPT Operating
Partnership, L.P.
Form 10-K for the
Year Ended December 31, 2022
Filed March 1, 2023
File No. 001-32559
Form 8-K Filed
February 23, 2023
File No. 001-32559
Dear R. Steven Hamner:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments. In some of our comments, we
may ask you to
provide us with information so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for the year ended December 31, 2022
Significant Tenants
Total Assets by Operator, page 13
1. We note that your table
presents total assets by operator on an actual basis along with
corresponding
percentages by operator. Immediately below this table, you present
percentages for certain
operators on an adjusted basis. We note that you have reconciled
from total assets to
total adjusted gross assets on page 52. Please address the following:
Please tell us and
revise your filing to clarify the nature of the assets that are
associated with an
operator (i.e. real estate assets, mortgage loans, investments in
unconsolidated
operating entities, etc.)
R. Steven Hamner
FirstName LastNameR.
Medical Properties Trust,Steven
Inc. Hamner
Comapany
July 3, 2023NameMedical Properties Trust, Inc.
July 3,2 2023 Page 2
Page
FirstName LastName
For the adjusted operator percentages, please tell us and
revise your filing to provide
additional qualitative and quantitative disclosures that provide
an understanding of
each of the adjustments on an operator by operator basis.
For each adjustment that relates to a transaction that had not
closed by the date of the
filing, please tell us your basis for presenting the percentage
as if such transaction had
closed.
Non-GAAP measures
Total Adjusted Gross Assets, page 52
2. We note that the reconciliation for Total Adjusted Gross Assets is
quite complex. Please
address the following:
Footnote (3) appears to combine elements of the committed
transactions but that
these elements do not appear to be clearly quantified within
referenced Notes 8 and
13 to the financial statements. Please enhance your disclosure by
breaking out the
captions "Gross book value of assets in transactions as described
in Notes 8 and 13"
into multiple captions (i.e. one for each transaction).
Footnote (4) appears to combine multiple transactions. Please
enhance your
disclosure by breaking out the caption "Expected cash proceeds
generated by the
transactions as described in Notes 3, 8 and 13" into multiple
captions (i.e. one for
each transaction).
For each adjustment that relates to a transaction that had not
closed by the date of the
filing, please tell us your basis for presenting gross assets as
if such transaction had
closed.
This comment also applies to your presentation of total adjusted
gross assets in your
earnings release included in your Form 8-K.
Notes To Consolidated Financial Statements
3. Real Estate and Other Activities
Investment in Unconsolidated Operating Entities, page 84
3. We note per the table on page 84 that Steward loan investments are
$362.8 million and
$360.2 million as of December 31, 2022 and 2021, respectively. We also
note that you
disclosed on page 85 that during the second quarter of 2022 you loaned
$150 million to
Steward pursuant to a 5-year secured loan. Further, within your
disclosure regarding
Steward on page 14, you disclose that you hold a promissory note
totaling approximately
$220 million and you made a $335 million loan to affiliates of Steward
in 2021. Please
address the following:
Please help us understand the reason that the Steward loan
investments only
increased by approximately $3 million as of December 31, 2022
versus the
comparable year in light of the $150 million funding in 2022.
In your response, help us to understand what is in the loan
investment balance of
$362.8 million on page 84.
Please clarify for us where you reflect the $220 million
promissory note, the $150
R. Steven Hamner
Medical Properties Trust, Inc.
July 3, 2023
Page 3
million amount lent during 2022, and the $335 million loan to
affiliates of Steward
made in 2021 on your balance sheet.
Please clarify if any loans to Steward or their affiliates are
mortgage loans. To the
extent such loans are mortgage loans, please clarify where this
information is
presented in your schedule IV.
Form 8-K filed February 23, 2023
Exhibits
4. We note your presentation of adjusted funds from operations ("AFFO") in
your exhibit
99.1. We note that your reconcilation to arrive at AFFO includes the
adjustment caption
"straight-line rent revenue and other" which totals $297.6 million and
$297.1 million for
the years ended December 31, 2022 and 2021, respectively. It appears
that this caption
may have significant balances derived from items other than
straight-line rent revenue, as
the straight-line rent revenue amounts from your income statements were
$204.2 million
and $241.4 million, respectively, for those same periods. Please tell us
the nature of any
large adjustments within this line item that are derived from items
other than straight-line
rent revenue. Further, please confirm that you will provide a separate
line caption(s) to
breakout such large items in future presentations of AFFO.
5. We note your presentation of adjusted net debt in your exhibit 99.2.
Please address the
following:
Footnote (B) appears to combine multiple transactions. Please
enhance your
disclosure by breaking out the caption "Adjustments after December
31, 2022" into
multiple captions (i.e. one for each transaction).
For each adjustment that relates to a transaction that had not
closed by the date of the
filing, please tell us your basis for presenting net debt as if
such transaction had
closed.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
You may contact Howard Efron at 202-551-3439 or Jennifer Monick at
202-551-
3295 with any questions.
Sincerely,
FirstName LastNameR. Steven Hamner
Division of
Corporation Finance
Comapany NameMedical Properties Trust, Inc.
Office of Real
Estate & Construction
July 3, 2023 Page 3
cc: Kevin Hanna
FirstName LastName