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New 35-Acre Health And Wellness District At Frisco Station Takes A Step Forward

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A 35-acre health and wellness district is coming to the nearly $2B Frisco Station development.

An aerial view of the location of a planned health and wellness district at Frisco Station (IMAGE CREDIT: Debra Hale at Hillwood)

Dallas-based Cambridge Holdings just entered into an exclusive agreement with Frisco Station Partnership to develop healthcare and health and wellness-related projects within the fast-growing 242-acre development situated at the crossroads of the Dallas North Tollway and Warren Parkway, near the Dallas Cowboys’ world headquarters, The Star.

Cambridge specializes in the development, financing, acquisition and management of healthcare projects, mixed-use campuses and corporate offices with a focus on sustainable, “healthy, mindful living” development projects.

Though the company didn’t provide exact details of what would be included in the district, it has previously developed dozens of facilities on hospital campuses across North Texas and is behind oneC1TY, a health-focused project in Nashville, Tennessee. The Nashville Post described the 19-acre oneC1TY as a “mixed-use urban node” home to healthcare, life sciences and technology companies and set to eventually comprise more than 1M SF of Class-A research, office, retail, residential and green spaces.

“Cambridge is excited to bring healthcare and the health and wellness component to life at Frisco Station,” Cambridge Chairman and CEO Jean-Claude Saada said in a release. “Our mindful, healthy development principles focused on sustainability and convenient access to fresh food, open space, daily activity and community engagement make the healthy choice the easy choice for people who live, work, and visit. We think these concepts will be embraced in a community like Frisco that is already focused on addressing the total wellbeing of the community and individuals.”

Saada said he hoped to make the district a model for healthy living that would be emulated around the world.

Launched in 2015, Frisco Station was one of the nation’s first communities to be built from the ground up with AT&T’s 5G platform. It is also home to one of the world’s first vertiports to support flying taxis and is partnering in Texas’ first pilot project to test autonomous vehicles on public roadways.

“With Cambridge joining our team, we are reaching the full potential of Frisco Station as a globally recognized Smart, Creative, and Healthy mixed-use neighborhood,” said Trey Sibley, general manager of The Rudman Partnership, one of the three partners in the Frisco Station Partnership, alongside Hillwood and VanTrust Real Estate. “We couldn’t be more pleased to have them join us as we execute what’s considered to be the crown jewel of the project — the place where residents and visitors can experience ways to live healthier, more active and longer lives.”

Frisco Station’s master plan also calls for 2,400 residential urban living units, a 55-acre corporate campus, a dining, shopping and entertainment district, 3M SF of mid- and high-rise office space, and 30 acres of programmed trails, parks and open space.

Source: Bisnow

Investors Sizing Up Seniors Housing’s Impending ‘Bull Run’

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Large investors are making a macro call that time is right to enter the seniors market after being on the sidelines even before the pandemic, according to Ted Flagg, Senior Managing Director for JLL Capital Markets, speaking to GlobeSt.

“Finite life investment vehicles that put planned sales on hold with the pandemic are now testing the market with marketing processes,” Flagg said. “There is a widely held view that we are in early days of a bull run in seniors housing (e.g., double-digit annual NOI growth over the medium term) – the question is not ‘if’ there will be outsized growth but rather debate around the timing of that recovery.”

A New Initiative

One sign this timing is getting closer comes from an announcement last week from Monarch Alternative Capital, an investment firm with approximately $9 billion of assets under management, and American House Senior Living Communities, a national leader in the senior housing industry, that they were forming a joint venture to acquire, develop, and manage senior housing properties across the US.

Monarch and American House launched the partnership through the recapitalization of six properties partially owned by American House and one property acquisition from a third party. The newly formed joint venture has the capital, sourcing capabilities, and operating expertise to capitalize on the severe disruption in the senior housing industry caused by COVID-19 and the anticipated supply-demand imbalance resulting from construction and demographic trends.

The seven-property portfolio totals 1,047 units, comprising 525 independent living units, 356 assisted living units, and 166 memory care units concentrated within Florida, Michigan, and Ohio, with an average age of approximately five years.

Monarch believes that the senior housing industry is at an inflection point given the trends of a growing elderly population against the backdrop of a significant slowdown in construction activity of new properties. The joint venture expects to opportunistically invest in additional properties in the near-term.

Distressed Buyers Not Seeing Distressed Prices

Some are seeking distressed assets and looking to strike a bargain on those communities that are available.

“Distressed buyers have been mostly disappointed with the lack of truly distressed pricing,” Flagg said. “Buyers believe pricing was irrationally high in 2018-2019, leading up to the pandemic; now there are more opportunities for reasonable risk-adjusted returns even if not deeply opportunistic. Active-adult (age-restricted housing) is showing the most liquidity today as it catches the tailwind of white-hot traditional multifamily cap rate compression.”

This ‘Arrow is Pointing Up’

Kevin Kinigstein, lead partner of Cox Castle & Nicholson’s senior housing practice group, tells GlobeSt that he thinks seniors housing is a great asset class to invest in.

“The pandemic was particularly difficult on the seniors housing industry, but I believe the arrow is pointing up,” Kinigstein said. “The impact on the seniors housing industry lasted well into 2021 (and is still being felt in many ways). However, while the short term has been challenged, the medium- and long-term outlook remains strong.”

Waiting Out A ‘Challenging’ Period

“This is a sector that has strong medium- and long-term fundamentals, and there’s a recognition that many of those fundamentals remain constant,” Kinigstein said. “While there is no doubt that the industry has taken a hit and there are some improved buying opportunities as a result, a majority of the most active investors in the sector are experienced seniors housing investors who have waited out a very challenged period (as distinguished from inexperienced but opportunistic investors who think the industry has bottomed out). I believe the majority of transactions that will be completed over the next six to 12 months will be by investors who were already invested in (or interested in investing in) the sector pre-pandemic.”

 

Source: GlobeSt.

New Easterly Government Properties JV To Invest $636M In 1.2M Square Foot Portfolio

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The acquisition is set to be via a joint venture Easterly is forming with an unnamed major international investor that will close on the properties as they are developed.

The JV is expected to pay about $635.6M for the assets, which are mainly leased by the VA for 20 years each.

“This partnership expands our ability to execute on our external growth strategy by enhancing and diversifying our cost of capital,” Easterly Chief Financial Officer and Chief Operating Officer Meghan Baivier said in a statement.

A VA clinic in Lubbock, Texas, which is part of the portfolio that Easterly Government Properties is acquiring via a joint venture. (PHOTO CREDIT: Easterly Government Properties)

Easterly will retain a 53% stake in the JV while its partner will own 47%. Easterly will be responsible for the day-to-day management of the properties and receive asset management fees from its partner. The JV has already closed on the acquisition of two of the portfolio’s 10 properties, which are currently operating. The buyers expect to close on the remaining eight properties by the end of 2023 as they are completed and leased.

The two completed facilities are a 120K SF clinic in Lubbock, Texas, and a 31K SF facility in Lenexa, Kansas, both of which provide primary and specialty care services, such as audiology, dentistry, pathology and lab services. The other facilities will be in Alabama, Arizona, Florida, Georgia, Tennessee and Texas.

“Each new facility will enable the VA to expand its current services in its respective market by replacing smaller existing clinics or supplementing existing facilities,” Easterly said.

Not counting the new acquisition, the Washington, D.C.-based Easterly owns 83 properties nationwide totaling about 7.6M SF, including 81 properties leased to U.S. government tenant agencies and two leased to private tenants. As of Q2, the company is also at work on redeveloping a 200K SF property in Atlanta that will be leased to the Food and Drug Administration.

 

Source: Bisnow