Weekly Health Care Real Estate Briefing: Most Expensive Cities for Hospital Construction; Drive-In Care Site Proposed in FL; CON/Hospice Correlation

A recent report on construction costs and materials prices found that hospital construction costs in some large cities are as high as $970/sf (in Los Angeles). Of the large cities surveyed, maximum hospital construction costs were lowest in Las Vegas (up to $590/sf). Cement, concrete, structural block and gypsum materials all had double-digit year-over-year price increases as of April 2023.
Sendero Capital and Angelo Gordon launched a programmatic joint venture for outpatient health care real estate acquisitions. The JV will acquire up to $300M in outpatient health care real estate investments over the next two years.
While rent growth in traditional office and apartment markets has slowed, student housing rent is growing at about 9% year-over-year for college markets with research programs and top athletic conferences, while other markets have experienced declines in rents as overall college enrollment has declined.
VMG Health released a podcast episode discussing highlights of VMG’s annual Healthcare M&A Report and providing predictions for the second half of 2023. The valuation firm expects a notable uptick in M&A, particularly in the ASC, physician practice acquisition, oncology and post-acute sectors.
Some advisors expect M&A activity in the nursing home industry to remain strong in the second half of 2023 due to higher returns on a stabilized basis for SNF properties, compared to other property types, and the potential for ancillary service revenue for some operators.
Researchers from the American Journal of Hospice and Palliative Medicine found a correlation between states with CON laws and higher hospice quality outcomes. This correlation was stronger for small and medium hospices (having a daily census under 99) than for larger hospices.
Bliss Healthcare Services is seeking master plan approval from the City of Orlando for a 78,000 sf MOB that would feature a garage-style setup with drive-in care.
A Georgia appeals court affirmed that real estate leased by a hospital authority is public property and therefore exempt from property taxes, so long as the leased property and its income are used to further public hospital purposes.
A newly announced mixed use development in Las Vegas is aimed at providing housing and amenities to medical students, residents and faculty at UNLV Medical School in hopes of attracting and retaining medical talent in the area.
Mayo Clinic in Jacksonville, FL hosted a groundbreaking for a 179,000 sf Hilton hotel to be constructed on its campus. The 8-story, 252-room hotel is scheduled to open in 2025 and is the fourth active construction project at the campus.