Wilmington Health’s main facility recently sold for more than $9 million. 

The 66,000-square-foot facility located at 1202 Medical Center Drive was purchased by Charlotte-based real estate investment firm Cedar Square in a $9.4 million sale-leaseback transaction, according to a deed recorded Oct. 21.

Wilmington Health will continue leasing the facility, CEO Jeff James told the Business Journal in September. James said the lease term would likely be five years, with most services eventually transferring to a new medical office building under construction in the Midtown Park office area near The Pointe at Barclay.

The Wilmington Health facility was originally listed earlier this year at $11.85 million. A Wilmington Health representative did not respond to a request for comment by press time.

Steve Hall, vice president of BlueCoast Commercial, represented Wilmington Health in the transaction. 

“Wilmington Health wanted to unlock the value in its real estate without disrupting a single patient visit, and a sale-leaseback let them do exactly that,” said Hall in a text to the Business Journal Monday. “Cedar Square gets a long-term, absolute net investment anchored by one of the region’s leading physician groups, and Wilmington Health keeps its home on Medical Center Drive while redeploying that capital into care.” 

The sale marks Cedar Square’s first entry into the Wilmington market, according to Jon Dixon, the firm's managing partner and founder. 

“We are attracted to Wilmington's growth and what we see as strong long-term fundamentals,” said Dixon in an email Monday. “Population growth, relative affordability, and quality of life make it a compelling market for us. The climate and proximity to the coast are a big part of that appeal.”

He added, “We hope to pursue additional opportunities across retail, industrial, medical office and multifamily in Wilmington.  We will evaluate opportunities individually and remain disciplined about the properties we pursue. We would like this acquisition to be the beginning of a broader investment presence in Wilmington.”

Given the facility’s age, Dixon said the site could eventually be redeveloped, potentially for medical office space or housing. 

Dixon said recent announcements from UNC Health and Atrium were among the factors behind the firm’s growing interest in Wilmington’s medical-office market. The announcements involve competing proposals for hospital expansion in New Hanover County, which are subject to the state’s Certificate of Need process. 

“Medical office remains one of the most sought-after asset classes in commercial real estate,” said Hall, “and well-located (medical office buildings) with strong operators are scarce in Southeastern North Carolina.” 

According to Dixon, Cedar Square describes itself as a boutique, hands-on real estate investment firm that values direct relationships with tenants and the communities where it owns property. 

“We’re very hands-on, and we like to be in direct contact with all of our tenants and the communities in which we own,” Dixon said. 

He added, “We’re definitely interested in building a presence with local owners, brokers and businesses or tenants.”