- In a recent interview, the CFO of CA-based Prime Healthcare shed light on its real estate strategy. In 2020, most of Prime’s facility real estate was owned by a third party, with annual rental rates over $1.4B. Four years later, Prime now owns the real estate of 40 of its 44 hospitals and is decreasing its debt levels.
- VMG issued its 2024 Healthcare M&A Report. Among the predictions, (1) health care companies will continue to divest non-core assets; (2) ASC operators will continue to consolidate; (3) acute-care hospital margins will continue to improve but hospitals in financial distress will represent a larger portion of the seller market; and (4) physician medical groups will continue to align with larger groups, sell to PE firms or integrate with health systems and insurers.
- Welltower reported a 19% year-over-year increase in funds from operations across its portfolio in 1Q 2024. Of particular note is its senior housing portfolio, which experienced a 10.3% increase in year-over-year same-store revenue for the quarter.
- For its part, senior living REIT LTC Properties also reported a $1.8M 1Q 2024 revenue increase year-over-year, and the CEO said the reimbursement landscape for skilled nursing looks encouraging.
- Two rival hospitals in Scottsdale, AZ are in a zoning dispute. One announced plans for a $400M, multifaceted project in the northeastern part of the city, while its competitor bought land across the street and is seeking to rezone it for hospital use – a use which the first health system has challenged.
- Novant Health announced that it plans to build a 26-bed cancer hospital in Buncombe County, south of Asheville, NC. The next hurdle for the project will be state CON approval.
- Healthcare Realty Trust entered into a $1B joint venture with investment firm KKR to jointly own and invest in medical outpatient buildings. As part of the agreement, Healthcare Realty Trust will contribute 12 of its existing medical outpatient buildings, valued at $382.5M.
- Champaign County, IL filed a motion asking the Illinois Supreme Court to reconsider hearing a case over property tax exemptions granted to Carle Foundation. The case began in 2013 and relates to charitable tax exemptions for 2004-2011. In 2017, the Illinois Supreme Court effectively upheld the constitutionality of the charitable-use tax exemption statute upon which the exemptions rely.
- Becker’s published a roundup of 15 hospital projects announced thus far in 2024 that are over $500M each. Six projects on the list are over $1B in value, including projects in PA, TX, CA, FL and MI.
- Physician investor group North Cypress Land Ventures broke ground on a 60,000-sf, $600M medical park in Cypress, TX slated to be completed in June 2025. Most of the first building has been pre-leased with tenants across multiple disciplines, anchored by a 12,000-sf endoscopy surgery center.
For more information on real estate matters, please contact:
- Andrew Dick at adick@hallrender.com or (317) 977-1491;
- Joel Swider at jswider@hallrender.com or (317) 429-3638; or
- Your primary Hall Render contact.
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.
