For Profit HCA Florida Beefing Up Competition In Southwest Florida To Publicly Run Lee Health

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HCA Healthcare is expanding its presence in Southwest Florida and competing with the dominant health system, the publicly operated Lee Health.

The ongoing expansion of the for-profit HCA will include a 100-bed hospital at 3851 Colonial Blvd. that is in planning stages and a freestanding emergency room under construction at 8919 College Pointe Court.

The increasing competition from HCA is among the reasons why Lee Health is considering converting from a public system to a private nonprofit one. The change would provide leverage to partner with other health care systems and would allow Lee Health to go outside of the county. Lee Health’s publicly elected board will make a decision by October on a conversion or not.

In 2006, HCA sold its two hospitals in Fort Myers to Lee Health; Southwest Florida Regional Medical Center that no longer exists and Gulf Coast Hospital that has been renamed Gulf Coast Medical Center at 13681 Doctors Way off Daniels Parkway.

What Does HCA Own In Southwest Florida?

HCA’s main presence in Lee is through ownership of eight MD Now Urgent Care locations, including one in Naples. The locations are in Fort Myers, Cape Coral, Harlem Heights, Lehigh Aces, Estero and Naples. HCA bought MD Now, which has 59 locations in the state, at the end of 2021.

The company is building a freestanding emergency room in Fort Myers at 8919 College Pointe Court with an estimated cost of $6.5 million, according to Lee County records.

“HCA Florida Fawcett Hospital, located in Port Charlotte, is involved in the project,”  spokeswoman Debra McKell said in an email. “This 10,820-square-foot facility will operate around the clock with full-service emergency services including laboratory, X-rays, CT scanning and ultrasound. We recently held a beam signing event at the location and are expecting it to open in fall 2024.”

HCA Fawcett Hospital opened a similar freestanding emergency room in Cape Coral in June 2022. The address is 322 SW Pine Island Road.

What’s The Status Of The New Hospital?

The hospital will be built at 3851 Colonial Blvd., which is just northeast of McGregor Baptist Church.

“The details are being finalized after the site had to be rezoned and some mitigation had to be done,” McKell said.

She did not immediately have a time when construction will start.

When HCA announced in 2021 plans for the hospital, officials said it would be four stories with 275,870 square feet and would include an emergency room, trauma care, labor and delivery, among other services.

The Fort Myers hospital is one of three planned as part of HCA’s market expansion in the state. The other two are a 90-bed hospital in Gainesville and a 60-bed hospital near the Villages. Statewide HCA Florida has 49 hospitals and 65 urgent care centers. It reports treating 7.4 million patients in the state each year.

Nationally HCA Healthcare reported $17 billion in revenue for the fourth quarter of last year ending Dec. 31, according to its financial report.

 

Source: News-Press

Greystone Closes $425M Healthcare CLO

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Greystone has closed a $425 million CRE CLO that is backed exclusively by bridge loans provided by Greystone Monticello on healthcare-related properties.

The transaction marks Greystone’s sixth overall CRE CLO and the industry’s third-ever CRE CLO composed solely of healthcare assets, particularly skilled nursing, assisted living, memory care, and independent living facilities, the first two being closed by Greystone in 2018 and 2021.

The collateral pool for this latest healthcare CLO comprises 13 whole loans and 9 participations totaling $397 million that Greystone originated, secured by mortgages on 51 properties in 19 states. Skilled nursing properties make up a majority of the portfolio, with 76.5%, followed by assisted living, with 8.7%. Greystone will invest the remaining $28 million of CRE CLO proceeds over the next 180 days into comparable mortgage loan assets. This actively managed CRE CLO has a 2-year reinvestment period.

“We have seen tightening in the capital markets over the past six to twelve months and this CLO created a compelling opportunity for investors to participate in a proven, industry-leading lending platform with significant upside as the economy continues to improve,” said Ross Gusler, Managing Director of Corporate Finance and Capital Markets at Greystone, in prepared remarks.

To date, Greystone and Greystone Monticello’s combined Bridge-to-Agency lending platform, which includes Fannie Mae, Freddie Mac, and HUD, has provided over $18 billion in short-term bridge loans across the healthcare and multifamily sectors.

 

Source: GlobeSt.

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Big Investor Has A New Strategy For Healthcare

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A new investment company, SPHERE Investments — standing for Strategic Public Health Equities and Real Estate — is looking to reinvigorate approaches to healthcare investment.

While the company is technically new, it’s the development of Flagler Healthcare Investments, with a lot of experience, access to massive amounts of industry data analysis, and a claimed $1 billion healthcare portfolio.

Founder Didier Choukroun tells GlobeSt.com that to make healthcare work well, a much broader investment in properties that, while not considered healthcare, are a necessary infrastructure.

“I wanted to find a sector of the U.S. economy that could drive the economy with a value proposition that would go beyond the buildings,” said Choukroun. “We decided in 2023 to not only expand geographically, but we expanded the mission and repositioned the entire company. We have to get beyond healthcare.”

He saw a need to look at social drivers of healthcare, including environment, nutrition, education, housing, and transportation.

“We also wanted to make sure we continued on what has made our company successful, which is if you really want to invest in healthcare real estate, you cannot only focus on your immediate tenant,” said Choukroun. “Success comes from the outcome of the patient.”

On the direct care provision side, they focus on tenants in oncology, cardiovascular, neurology, and a combination of GI and endocrinology. Choukroun points to a Pareto-type distribution, with the four sectors served by 19% of all providers bringing in between 65% and 66% of personal care expenditure. It provides a density of demand, creating a strongly stable floor. The firm is also focused on senior living and care, including independent living, assisted living, and memory care, with some twists.

“None of the management companies are profitable,” Choukroun said. “Acquisition costs are four to five times EBIDTA. Most of the good management companies refused to sign long-term leases, forcing property owners to hold the risk. I think the business model of senior living in the US is not functioning; 98% comes from the inclusive rental of the bed. Every single operator fights on price. It’s their only strategy. Instead, they should be looking at both healthcare and non-healthcare services for the residents, including wellness, adult day care, and transportation. Management fees are 5% of revenue. There is no way the manager can focus. The way out is to focus on the outcomes.”

SPHERE identified 181 management companies with at least 20 communities under management.

“They’re trying to make money on the real estate,” said Choukroun. “Owners give the management companies a small carried interest or something like that. If you focus on outcome, you will bring technology in, you will rethink the model. One way to change the model is to be much more proactive in creating a pipeline of leads,” like being in contact with potential future residents. And then there could be other seemingly non-related services, like having daycare for kids and using elders, who may lack self-esteem in current care philosophies, to have a role. Or tutoring services for underprivileged communities near a center.”

 

Source: GlobeSt.