Florida-Based Primary Care Provider Expands Into Fort Worth With Two Acquisitions

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Florida-based Palm Medical Centers is expanding into Texas with the acquisition of two longstanding primary care practices in Fort Worth.

Through the deal, Texas Family Medicine, located at 6100 Harris Pkwy, and Fort Worth Primary Care, located at 800 8th Avenue Suite 626, will shift to the Palm Primary Care Texas brand. The clinics are expected to change names in September.

Terms of the transaction were not disclosed.

“I’m honored to be able to bring the Palm model to my hometown physicians of Fort Worth, where I’ve spent over 20 years of my career advocating for Medicare beneficiaries and partnering with local physicians,” Fowad Choudhry, CEO of Palm Medical Centers, said in a prepared statement.

Founded by Dr. Brian Byrd, Texas Family Medicine has been serving residents in Southwest Fort Worth since 2001. Fort Worth Primary Care is owned and led by Dr. Morvarid Rezaie, who has spent 15 years in the Fort Worth Medical District.

Combined, the two clinics offer four primary care physicians and four advanced practice providers on staff.

“The aging population in North Texas continues to increase at a blazingly rapid pace, and there is a need for additional high-quality physicians to provide our patients with a genuinely personalized patient experience,” Byrd said. “Fowad has been a friend to physicians in Fort Worth for over 20 years. I am pleased to work with him again to bring other independent doctors together to help improve patient experience throughout our community.”

Palm Medical Centers will also establish its Texas corporate office in Fort Worth as it expands into the state.

“While a location for the office has not been solidified, the provider is looking into Central Fort Worth,” said Dana Tarrant, VP of Operations for Palm’s Texas Market.

Founded in 2013, Palm Medical Centers offers primary care services through 32 locations across Florida. The provider plans to expand further across North Texas with openings scheduled through 2024.

 

Source: Dallas Business Journal

Five Reasons For Physicians To Invest In Medical Office Buildings

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Medical office buildings are becoming increasingly attractive to investors and real estate managers due to their stability and upside potential.

Here are five reasons why medical office buildings could be a good investment for physicians, according to a June 5 report from Benzinga and CityVest, a real estate investment platform.

  1. The healthcare industry is resilient through changing economic cycles. The need for healthcare and treatment of patients will always exist and is not subject to market downturns.
  2. There is a trend toward treating patients in medical office buildings and outpatient settings over hospital settings. Medical office buildings often have high occupancy rates and long-term leases.
  3. Medical office building tenants typically stay in one place for a long period of time, so they are willing to accept leases with renewal clauses and steady rent increases. Medical office building tenants have high expenses associated with moving, so retention rates are good.
  4. Medical office buildings draw in a diverse tenant base, with many different specialists that maintain a steady income.
  5. Over 4 million Americans will turn 65 this year, and baby boomers will start needing more medical care. Demand for medical offices will continue as people need more medical care.

 

Source: Becker’s ASC Review

On-Campus Medical Office Pricing Now Exceeds Off-Campus Assets

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Limited availability of on-campus medical office assets has led to its pricing to uncustomarily exceed that of off-campus assets in Q1 2023 for the first time since Q1 2020, according to a report from Cushman & Wakefield.

Some are seeing the sector as a safe harbor during these challenging economic times.

Jason Anzalone, managing director of development, Cypress West Partners, tells GlobeSt.com that macroeconomic volatility has led investors to pursue safe harbor investment options.

“They have found them in on-campus medical office assets that provide immediate adjacency to acute care facilities, often have health system occupancy, and credit quality and assurances of long-tenured occupancy,” says Anzalone.

C&W’s report said that off-campus transactions have historically made up a good majority of transactions over on-campus facilities.

“With often limited land and many healthcare systems holding ownership of on-campus assets,” Cushman wrote.

Since 2020, off-campus transactions have held an average 5% premium over on-campus in terms of pricing. Occasionally, off-campus averages have fallen below that of on-campus – notably during Q1 2020 at the start of COVID-19 and now, in the preliminary values for Q1 2023, according to the report.

Average cap rates for on-campus assets have grown by 50 bps to an average of 5.5%, while off-campus has risen by 45 bps to an average of 6.5%.

“As with overall transaction volume, both on-campus and off-campus assets have dropped during the second half of 2022,” according to the report.

Volumes for both categories remained relatively strong compared to pre-pandemic historical levels during the middle two quarters last year.

On-campus transactions exceeded $800 million, while off-campus transactions were above $2.5 billion. In Q4, transactions in both categories were much more limited, with off-campus transactions falling by 50% while on-campus receded to only $696 million.

 

Source: GlobeSt.