- PWC and the Urban Land Institute published their Emerging Trends in Real Estate report for 2023. The report is extensive and wide-ranging in scope, but one interesting finding was a list of markets where the greatest overall real estate growth is expected in 2023. Among the hottest markets were Nashville, Dallas-Fort Worth, Atlanta, Austin, Raleigh/Durham and Miami, due to large and consistent population and job growth as well as above-average levels of economic diversity and employment.
- Hall Render published a new podcast episode titled Analytics to Action: Revolutionizing Health Care Real Estate Strategy featuring Andrew Dick and JLL’s Matt Coursen. Additionally, Andrew Dick published a blog post on understanding the difference between Absolute Net, Bondable and Credit Tenant Leases as well as 5 tips for working on Ground Lease Transactions.
- Hospitals in the United States are on track for their worst financial year in decades. Median hospital operating margins were cumulatively negative through the first eight months of 2022 as a result of significant pressures on multiple fronts including labor shortages and supply chain disruptions. These financial pressures are unlikely to resolve in the short term, per HealthAffairs.
- Disney has become the latest high-wattage brand to make a senior living play, announcing its intentions to include 55+ housing in its forthcoming Storyliving by Disney residential development.
- Private equity health care real estate firm, Thomas Park Investments, announced it has entered a programmatic joint venture (“JV”) with a global REIT. The JV broadens Thomas Park’s investment strategy, allows tax-advantaged purchases and allows the REIT access to Thomas Park’s off-market opportunities. Thus far, the JV has purchased assets in Raleigh, NC; Baltimore, MD; and Lawrenceville, NJ.
- Lenders to the medical office sector signaled caution as loan volumes are anticipated to be lower over the next 12 months, per RevistaMed. Interest rates have been rising dramatically for the past several months, which, combined with market uncertainty, has resulted in stricter underwriting criteria, techniques and low volumes for the forecasted future.
- A JV between OhioHealth and Select Medical has submitted plans for a neuro-transitional rehabilitation center in Dublin, OH. The rehab center would provide post-hospital, inpatient neuro and physical rehabilitation specialty programs designed for recovery treatments. The center would operate 24/7.
- A JV between OSF HealthCare and U.S. HealthVest is seeking regulatory approval to build a 100-bed psychiatric facility in Peoria, IL, which would be the largest Illinois mental health hospital south of Chicago. OSF said this is a response to the shortage of psychiatric beds, which has only become more severe since the pandemic.
- Indiana University Health’s Saxony Hospital in Fishers, IN, broke ground on a $300 million expansion to be named IU Health Fishers. The expansion will add 38 inpatient beds and expand services in obstetrics, gynecology, nephrology, neurology and pulmonology. A new stand-alone outpatient physician office will be built to offer more support services and space for additional staff.
- JLL Healthcare Capital Markets published a report indicating that medical office tenancy provides a defensive investment strategy in the current market, given that the health care sector tenant base is amongst the most creditworthy of any sector. Additionally, more than three-quarters of U.S. health systems are nonprofit or government-backed, meaning they can access additional sources of capital not available to for-profit enterprises.
Special thanks to Thomas Dziwlik, undergraduate intern, for his assistance in the preparation of this article.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot give legal advice outside of an attorney-client relationship.
