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Since founding Healthcare Trust of America in 2006, our goal was to build the leading medical office building (MOB) company in the United States while always putting shareholders’ interest first in all of our management decisions. We executed on many “firsts” in our pursuit of this goal: reducing fees as a non-traded REIT, remaining a cash buyer during the recession, internalizing asset management, and listing our shares on the NYSE (without raising equity). These decisions and others have allowed HTA to execute our focused business plan and produce consistent returns for shareholders over the past eleven years.
This year, we became the largest medical office building owner in the country, with the best in class portfolio, located in 20-25 key gateway cities in the United States. We believe this is a unique real estate sector for many decades to come, given the strong demand for healthcare. The population is aging, with 10,000 individuals turning 65 every day and the millennials forming families, increasing utilization. Healthcare providers are focused on increasing the cost effectiveness of care, and are moving to outpatient locations. All of this helps drive the solid medical office fundamentals that we continue to see.
Our desire continues to focus on building a unique different kind of healthcare real estate company. A company that not only owns the medical buildings, but also operates them internally and provides real estate services to healthcare providers as they grow and adapt to the changing healthcare environment.
From a strategic perspective, this means we are investing in high quality MOBs located both on hospital campuses and in core community locations that are convenient to patients, provide better healthcare outcomes and are in a lower cost environment. We are focusing on 20-25 key markets that will grow over the coming decades due to solid population growth, strong academic infrastructure and pro-business regulatory environments. This focus allows us to build economies of scale in these markets, and roll out our sector leading asset management platform, which delivers everything from property management and leasing, to construction and development solutions to this fragmented market. We are doing this with a long term owner’s perspective, investing in our buildings and local relationships, while keeping our financial balance sheet strong. This combination of a high quality portfolio, best in class operating platform, and financial strength as an investment grade public REIT should position us for continued stable and growing performance for our shareholders, tenants, and employees alike.
In 2017, we had the opportunity to move forward on these strategic goals by investing over $2.7 billion of best in class medical office buildings, 90% of which were located in our existing key markets. This was primarily achieved through the acquisition of the Duke Realty Medical Office portfolio, which was widely viewed as the most attractive portfolio on the market.
As a result, HTA now stands as the largest owner and operator of medical office buildings in the United States, with almost $7 billion invested in a best in class portfolio of over 24 million square feet. These assets are located both on-campus, where we have the largest on-campus portfolio in the country, and off campus in core critical locations where healthcare is positioned to grow. We are concentrated in key growth markets, including 16 markets where we have over 500,000 square feet. Given this concentration and scale— HTA can continue to leverage our unmatched full service asset management platform that provides property management, building services, leasing, and construction and development services to our tenants. This platform allowed us to add incremental yield to our 2017 investments and is critically important to delivering the same store NOI growth that has been our hallmark since we went public in 2012. Simply put, we are THE leader in the medical office space.
Our execution on our existing business remained strong. We grew our same store cash NOI by 2.9%, growing revenue and margins. Our leasing activity was robust and we saw deal economics pick up in the back half of the year. Our operating platform not only took on approximately 7 million square feet into the platform, but also managed to grow margins on our existing portfolio. We did this all while maintaining a very efficient infrastructure, with our corporate overhead actually decreasing as a percentage of revenue.
Our balance sheet is as strong as it has ever been. To finance our investments during the year, we raised almost $1.9 billion of equity, executing on one of the largest equity offerings the REIT sector has seen in some time. In addition, we raised over $2 billion of debt capital, including a $900 million unsecured bond offering that was priced below some of our larger and better rated healthcare REIT peers, reflecting the combined strength of HTA. As a result, we ended the year with leverage below 30%, with significant liquidity and limited near term debt maturities; a position of strength.
Finally, from an overall company perspective we have made several organizational changes that align our Company with stockholders for the long term. First, we continue to add new directors with significant skills and experience to help guide us forward. This includes two new female directors which were added in 2018 and will help broaden our views and insight. Second, we’ve added certain stockholder rights to increase our accountability to stockholders, including opting out of the Maryland Unsolicited Takeover Act and allowing proxy access to stockholders. Finally, we continue to strengthen and improve our organizational infrastructure, with a focus on hiring, growing, and retaining the best and brightest employees in the sector. All of these have payoffs that go far beyond the bottom line.
Given the current quality of our portfolio, asset management platform, balance sheet and employees, we enter 2018 more excited than ever to execute on our strategic goals. Thank you for your trust, support and confidence in our directors and management team, and for the personal opportunity and privilege to be Chairman and CEO of Healthcare Trust of America, Inc.
Scott D. Peters
Chairman, CEO and President
April 29, 2018