- According to a recent report, cardiology outpatient strategy is shifting towards ambulatory surgery centers (“ASCs”) and away from hybrid office-based lab/ASC models to streamline staffing, space and back-office functions. Many health systems are prioritizing cardio ASC developments that are physically connected to, or in close proximity with, hospitals to support clinical integration and quality oversight.
- Nearly one in ten private U.S. hospitals are now private equity-owned, totaling 447 facilities. Of the total PE-owned hospitals, REITs own about one-third while joint ventures own about one-fifth.
- Boston Children’s Hospital closed on a sale-leaseback transaction for its Peabody (MA) campus. The hospital sold for $62M to an affiliate of asset management firm Barings and entered a long-term leaseback arrangement covering 114K sf to continue its pediatric clinical operations at the site.
- Delaware Gov. Matt Meyer signed legislation barring private equity investors from purchasing nonprofit hospitals in the state for two years. The legislation, which also introduced hospital price caps, follows the bankruptcy of Crozer Health, which was once Delaware’s largest hospital system.
- As part of its planned $500M campus upgrade project, Franciscan Children’s Hospital (Brighton, MA) announced that it will invest over $8M in geothermal energy at the campus. The project requires digging 42 geothermal wells that are 800 feet deep, plus construction of a dedicated utility plant that will comprise over an acre of land.
- In its first year of operation, Atrium Health’s $1.5B Pearl innovation district generated $224M in economic impact, created 2,270 jobs and reached 85% occupancy of its available leased space. When it reaches final completion, the 38-acre campus will encompass residential units, a hotel, office and retail space, plus a medical school and ample training and medtech spaces.
- According to a recent report, over the next 10 years, there will be a 15% increase in hospital outpatient and ASC volumes, a 31% increase in post-acute demand and a 7% increase in inpatient care discharges. The report also forecasts more care shifting to home and virtual care settings. If accurate, these changes would require the rebalancing of many health care real estate portfolios to meet these demands.
- The Cherokee Nation recently completed the $470M, 400K-sf W.W. Hastings Hospital. The new hospital replaces the tribe’s existing 180K-sf hospital and is part of a $1.2B investment by the Cherokee Nation into health care facilities and equipment.
- AdventHealth purchased 13 acres in West Orange County (FL) for $7.5M, with plans to build up to 60K sf of new medical office space. This follows a recent surge in population in the Horizon West area, which is expected to result in a corresponding increase in health care demand.
- Healthpeak Properties and Brookfield Asset Management announced a $2.1B joint venture involving a portfolio of 86 health care properties totaling 5.6M sf across 11 states. Healthpeak received gross proceeds of over $1B and will retain a controlling interest and remain the manager overseeing day-to-day operations and leasing at the properties.
For additional information on this topic, 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 or Hall Render Advisory Services contact.
Special thanks to Undergraduate Intern Amir-Ra Palmer for her assistance with the preparation of this article.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot—outside of an attorney-client relationship—answer specific questions that would be legal advice.
