Shore Capital Partners has sold a portfolio of 102 veterinary properties to Four Corners Property Trust for approximately $268 million, completing the realization of Shore Capital Real Estate Partners Fund I.
The portfolio consists of properties occupied by Mission Pet Health, one of the largest veterinary care organizations in the United States, with more than 930 locations.
Mission Pet Health’s veterinary operations were not included in the transaction. The company will continue operating at each property as the long-term tenant under net lease agreements.
Under a net lease structure, the tenant is generally responsible for some or all property-level expenses, which may include taxes, insurance and maintenance, in addition to rent.
The transaction transfers ownership of the underlying real estate to Four Corners while allowing Mission Pet Health to remain in the facilities and continue serving its customers without disrupting operations.
For Shore Capital, the sale represents the completion of its inaugural dedicated real estate fund, which was launched in 2021 with a focus on veterinary properties.
The fund was designed to complement Shore’s broader private equity strategy by providing real estate capital to portfolio companies as they expanded through acquisitions and organic growth.
Shore Capital uses an integrated real estate model that can include sale-leaseback transactions, build-to-suit developments, acquisition financing and other property-related solutions.
These structures can help operating businesses unlock capital tied up in real estate while continuing to occupy locations that are important to their daily operations.
In a sale-leaseback transaction, a company or property owner sells a facility to an investor and simultaneously enters into a lease allowing the operating business to remain at the location.
The approach can provide the tenant with additional capital for acquisitions, hiring, technology, renovations or other growth initiatives without requiring it to move.
Shore applied this strategy as independent veterinary practices joined Mission Pet Health.
Practice founders could receive an opportunity to monetize the real estate associated with their hospitals while Mission Pet Health continued operating the facilities under long-term leases.
The model supported Mission Pet Health’s acquisition strategy by addressing both the operating business and the real estate held by practice owners.
Veterinary hospitals can be particularly suitable for long-term real estate ownership because they often operate from specialized facilities with established customer bases and strong connections to their local communities.
Relocating a veterinary practice can disrupt customers, employees and operations, making existing locations important to the value of the business.
Shore assembled the individual properties into a larger institutional-quality portfolio that could appeal to public real estate investors seeking long-term rental income.
Four Corners Property Trust is a publicly traded real estate investment trust primarily focused on acquiring and leasing restaurant and retail properties.
The Mission Pet Health transaction broadens Four Corners’ portfolio through the addition of veterinary facilities occupied by a large national operator.
The company’s long-term ownership model made it a suitable buyer for the portfolio, according to Shore Capital.
For Four Corners, the acquisition provides exposure to a service-oriented real estate category supported by healthcare-related demand and a tenant with a substantial national footprint.
The properties will continue producing rental income under the existing net lease arrangements with Mission Pet Health.
The sale also demonstrates how Shore Capital’s real estate strategy can support its lower-middle-market buy-and-build investment model.
Buy-and-build strategies typically involve acquiring a platform company and expanding it through additional acquisitions, new locations and operational improvements.
Real estate can create complications in these transactions because business owners may also own the properties from which their companies operate.
A flexible real estate platform can separately acquire those properties, allowing Shore’s operating companies to complete transactions without requiring every seller to retain or continue managing the underlying real estate.
The strategy may also reduce the amount of capital an operating company needs to commit to property ownership.
Shore Capital Real Estate Partners Fund I concentrated specifically on veterinary real estate, reflecting Mission Pet Health’s growth and the opportunity to acquire facilities associated with its expanding network.
The successful sale provides Shore with a foundation for its second real estate fund.
Shore Capital Real Estate Partners Fund II has a broader investment mandate spanning healthcare, food and beverage, business services and industrial companies within Shore’s portfolio.
Fund II can also pursue selected real estate opportunities involving businesses that are not owned by Shore Capital.
The expanded mandate gives Shore greater flexibility to provide property financing across several industries and transaction types.
It could support portfolio companies that need new facilities, want to release capital from owned properties or require customized real estate arrangements as part of an acquisition.
The broader strategy also creates the potential to assemble diversified portfolios of mission-critical properties backed by long-term tenants.
Shore Capital invests in lower-middle-market businesses across healthcare, food and beverage, business services, industrial and real estate sectors.
The Chicago-based private equity firm also maintains an office in Nashville.
Shore focuses on established private companies with stable cash flow, experienced management teams and opportunities to grow through industry consolidation and organic expansion.
The firm has approximately $17 billion in assets under management and across additional investment platforms to which it provides business and operational consulting services.
Mission Pet Health was formed through the combination of Southern Veterinary Partners and Mission Veterinary Partners.
The company provides operational resources and localized support to veterinary hospitals while allowing medical teams to retain clinical autonomy.
The sale of the 102-property portfolio allows Mission Pet Health to continue operating from the facilities while placing the real estate under the ownership of Four Corners.
For Shore Capital, the transaction returns capital from its first real estate fund and demonstrates its ability to combine property financing with the growth of an operating platform.
KEY QUOTES:
“Our strategy was built to solve real estate challenges for growing businesses while creating attractive long-term opportunities for our investors. Mission Pet Health is a strong example of that approach. By providing flexible real estate capital alongside Shore’s operational investment model, we supported the company’s acquisition strategy and continued expansion while building a high-quality portfolio of mission-critical veterinary facilities. We’re pleased to transition these assets to Four Corners Property Trust, whose long-term ownership model makes them an excellent steward of the portfolio.”
Steve Malley, Partner and Head of Real Estate at Shore Capital
“As we continue to grow our investment platform, the successful realization of the first real estate fund is an important milestone. Shore Capital Real Estate Partners Fund II builds on that foundation by expanding beyond veterinary real estate to support our broader portfolio while pursuing select third-party opportunities. That flexibility strengthens the platform for both our portfolio companies and investors.”
Justin Ishbia, Co-Founder and Managing Partner of Shore Capital
