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Medical Properties Trust Comments on Closure of River Oaks Medical Center

Posted on: Tuesday, 24 June 2008, 02:30 CDT

Medical Properties Trust, Inc. (NYSE: MPW) today announced that Hospital Partners of America, Inc. (HPA) has elected to cease operations at River Oaks Medical Center in Houston, Texas. An affiliate of MPT is the owner and lessor of the real estate that comprises all of the facilities of the 524 bed hospital, which are located on two separate campuses in the southwest part of Houston.

MPT purchased the real estate from an HPA affiliate for $40 million and leased it back to the affiliate in August 2007. In anticipation of today's action by HPA, MPT has terminated the lease agreement. In addition to approximately $6 million in cash that was held back from the purchase proceeds, MPT is further secured by an unconditional guaranty of HPA and by an approximately 82% interest in HPA's Shasta Regional Medical Center in Redding, California. Edward K. Aldag, Jr., MPT's chairman, president and CEO said, "While we are presently unable to measure the amount of impairment, if any, that we may realize, we are optimistic that our security position with respect to our $6 million in cash, the parent guaranty, and the performance of the Shasta hospital may allow us to avoid negative effects on our financial position and results of operations. We are actively and continually monitoring circumstances as they develop."

About Medical Properties Trust, Inc.

Medical Properties Trust, Inc. is a Birmingham, Alabama based self-advised real estate investment trust formed to capitalize on the changing trends in healthcare delivery by acquiring and developing net-leased healthcare facilities. These facilities include inpatient rehabilitation hospitals, long-term acute care hospitals, regional acute care hospitals, ambulatory surgery centers and other single-discipline healthcare facilities, such as heart hospitals and orthopedic hospitals.

The statements in this press release that are forward looking are based on current expectations and actual results or future events may differ materially. Words such as "expects,""believes,""anticipates,""intends,""will,""should" and variations of such words and similar expressions are intended to identify such forward-looking statements, which include statements including, but not limited to, the capacity of HPA to perform its obligations pursuant to its unconditional guaranty of the River Oaks lease, the performance and the value of our interest in the Shasta hospital, the amount of any impairment of the River Oaks real estate value, and the effects of existing and evolving circumstances on our financial position and results of operations. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results of the Company or future events to differ materially from those expressed in or underlying such forward-looking statements, including without limitation: national and economic, business, real estate and other market conditions; the competitive environment in which the Company operations; the execution of the Company's business plan; financing risks; the Company's ability to attain and maintain its status as a REIT for federal income tax purposes; acquisition and development risks; potential environmental and other liabilities; and other factors affecting the real estate industry generally or the healthcare real estate in particular. For further discussion of the facts that could affect outcomes, please refer to the "Risk Factors" section of the Company's Form 10-K for the year ended December 31, 2007. Except as otherwise required by the federal securities laws, the Company undertakes no obligation to update the information in this press release.

Source: Business Wire

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