- Health systems are planning more construction projects focused on long-term growth and outpatient care, often renovating and repurposing existing facilities to support new services, according to a recent Modern Healthcare survey. While demand for inpatient beds remains strong, many health care organizations are focused on growing their outpatient and “medtail” footprints to better position future patient preferences.
- U.S. Senators Ed Markey and Elizabeth Warren introduced the Corporate Crimes Against Health Care Act of 2024, which would create criminal penalties for health care executives whose financial mismanagement leads to a patient’s death. It also allows the government to claw back compensation paid to private equity executives within a 10-year window surrounding the financial distress of a health care organization. The senators said the bill was introduced in direct response to the Steward Health sale-leaseback deal that led to the company’s recent bankruptcy.
- Hall Render attorneys and advisors will host a live webinar on July 23 at 1 PM ET. The roundtable discussion will focus on health care real estate trends that were predicted at the outset of 2024, and we will take a mid-year look at whether those trends have materialized and what is on the horizon during H2 2024.
- A recent report comparing health care real estate metrics from Q1 2023 to Q1 2024 found that both sales volume and the overall number of transactions in the HCRE market declined by about 18% year-over-year. Cap rates increased from 6.41% to 6.96%, although cap rates by specialty showed more variation, and ASC cap rates decreased year-over-year.
- Becker’s recently highlighted 10 health systems increasing in size via acquisitions of existing hospitals in 2024, including 9-figure and 10-figure deals by Kaiser Permanente, HCA, UCI Health and Novant Health, among others.
- Hall Render has become aware of two health care real estate professionals with former health system experience who are looking for new opportunities in the real estate industry. Both have experience as in-house real estate counsel with large health systems before moving to business roles overseeing large portfolios of health care real estate, transactions and personnel. Please reach out to Andrew Dick or Joel Swider for more information.
- The Northampton County (PA) Council approved a proposed eight-facility sale-leaseback transaction between Lehigh Valley Health Network and the nonprofit Centurion Foundation. Up to $160M in tax-exempt bonds will be issued to finance the transaction, which is structured to allow LVHN to raise capital to support its nonprofit health care mission without having to issue debt.
- A joint venture between Riverside University Health System and PMB broke ground on a $580M behavioral health campus in Mead Valley, CA. The 18-acre site will feature a youth and family care center with outpatient and children’s crisis residential care, a wellness and education center and supportive housing.
- Two new buildings totaling $475M were recently announced for the Worcester, MA campus shared by UMass Chan Medical School and UMass Memorial Health. One building will be a $350M education and research building designed for advanced disease research, while the other will be a $125M, 72-bed acute care facility.
- Although South Carolina recently passed legislation sunsetting the state’s CON program by 2027, projects that remain subject to the law continue fighting for state and local approvals in the meantime. One such example is a planned 20-bed, acute care facility in Bluffton, SC that was originally approved by the state in 2018, but construction has yet to begin due to ongoing court challenges by a competitor.
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.
