Baptist Health South Florida Buys Coral Gables Development Property Site

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Baptist Health South Florida has acquired a development site in Coral Gables from an entity co-owned by Ugo Colombo of CMC Group and Masoud Shojaee of Shoma Group, according to multiple sources familiar with the deal.

The 2.8-acre site at 250 Bird Road in Coral Gables was sold to Baptist Health South Florida (PHOTO CREDIT: Avison Young)

The price for the 2.8-acre site at 4112 Aurora St. and 250 Bird Road was not yet recorded in county records. One source with knowledge of the deal said the price was around $37 million.

The seller, Coral Gables Luxury Holdings, was represented by Avison Young. Baptist Health, the largest hospital operator in South Florida, has its administrative building nearby. It also owns a hospital in Coral Gables.

 

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Moving Away From The Mothership: Satellite Healthcare Campuses Embrace Multimillion-Dollar Expansion, Specialized Services

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When Texas Medical Center-headquartered healthcare systems began acquiring land outside of the Inner Loop, most secured more land than they initially built up.

Many of those satellite campuses are now under multimillion-dollar expansions as they increasingly stand on their own for specialized care rather than as feeder hospitals for the TMC.

Methodist West Campus (Photo Credit: Houston Methodist Houston)

“You cannot innovate from a space perspective in the Medical Center like you can in some of the new hospitals that are located away from the urban core,” Wolff Cos. Executive Vice President Carolyn Wolff Dorros said. “The suburban hospital expansion is transforming these facilities into mini medical centers.”

Swelling Up In The Suburbs

Nearing space capacity at the Texas Medical Center, hospitals turned to Houston’s booming submarkets — Sugar Land, The Woodlands and Katy — for expansion.

 Demand spiked due to the influx in residents, who increasingly prefer healthcare providers and services, from regular checkups to more complex concerns, closer to their home,” Colliers Senior Vice President Coy Davidson said. “There are no longer just feeder campuses for the mothership — the suburban campuses provide top-notch specialized care.”

Most healthcare procedures, excluding services like heart and organ transplants, will be offered at these centers. All of the expansions share one common thread: a desire to offer the same advanced quality service as the flagship hospitals in the Texas Medical Center.

Tracking The Expansion

Houston Methodist System is under construction on two hospital expansions in Sugar Land and The Woodlands. The Sugar Land hospital launched a $60M expansion project to improve its women’s health services in April. The plan includes constructing a three-story, 30,500 SF building and renovating the existing Sweetwater Pavilion. The facility has experienced an increase in patients from communities outside of Fort Bend County, including Waller, Austin, Brazoria, Wharton and Victoria, according to Houston Methodist Sugar Land Hospital CEO Chris Siebenaler.

“Fort Bend continues to be one of the fastest-growing counties in the U.S., which drives the demand for women’s health services,” Siebenaler said.

A rendering of the The University of Texas MD Anderson Cancer Center (Photo Credit: Courtesy of MD Anderson)

The University of Texas MD Anderson Cancer Center is opening a three-story, 208K SF building in The Woodlands. Serving as an extension of MD Anderson in The Woodlands, the outpatient clinic will feature similar treatment and supportive services, plus new diagnostic and screening services.

It is expected to welcome patients in the spring.  What specialized services are being built out is determined by the needs of the area. In Katy, the home of an eight-time state champion high school football team, Memorial Hermann is investing $15M to construct a 50K SF sports and medicine and human performance facility. The project will be on the Memorial Hermann Katy Hospital campus and provide targeted medical care and athletic training for professionals athletes, youth athletes and active adults.

“Another hospital expansion in Katy is providing a cost-saving solution for patients,” Dorros said.

Texas Children’s Hospital West Campus, the first community hospital designed exclusively for children, opened Texas Children’s Urgent Center adjacent to its emergency room in September. Of the 12 clinics for TCH, this is the second to open steps away from one of its hospitals.

“Patients are allowed to come to either facility and be directed to the appropriate facility depending on the severity of the visit,” Dorros said. “Having both options can lower unnecessarily high hospital bills, shorten wait times and increase use of the appropriate healthcare options. That is such a better patient experience, Patients are getting the right care at the right time.”

Learn more about healthcare-related development opportunities at Bisnow’s National Healthcare South event at the InterContinental Houston Medical Center Feb. 27.

 

Source: Bisnow

An Overview Of The Medical Office Market

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The average asking rent for medical offices reached the highest level on record in the second quarter of 2018, rising 1.4 percent year-over-year to $22.90 per sq. ft., according to a late December report from CBRE.

The firm pointed to tight market conditions and the completion of new, high-quality space as reasons for the continued rent increases.

“Rents increased in two-thirds of the markets tracked by CBRE and grew fastest in some of the markets with the lowest vacancy rates, including Nashville, Manhattan, Louisville, Seattle, and Indianapolis,” Andrea Cross, Americas head of office research, CBRE, said in a statement.

Another factor is that health systems are increasingly using lower-cost outpatient centers. These facilities enable health systems to provide services closer to where patients live. According to CBRE, the total number of outpatient centers grew by more than 50 percent to approximately 41,000 from 2005 to 2016. In addition, outpatient center employment has more than doubled since 2003, and grew 3.5 percent year-over-year in October 2018, compared with 2 percent annual growth in overall healthcare employment.

“Healthcare systems are increasingly catering to patients as consumers—rather than simply users—of healthcare services,” Mark Lamp, executive managing director, healthcare, CBRE, said in a statement. “They are creating outpatient facilities that provide a more ‘hotel-like’ experience—and at a lower cost than the more expensive hospital services—with technology-enabled check-in, abundant natural light and incorporated outdoor spaces, and patient care concierges trained to support guests with any needs.”

On the development front, CBRE‘s report concluded that medical office development strongly correlates with population growth, with Phoenix, Houston, Dallas/Ft. Worth and Atlanta among the top markets for total completions from the third quarter of 2017 to the second quarter of 2018, along with Minneapolis/St. Paul, a leading healthcare cluster. Houston, Minneapolis/St. Paul, Atlanta, Chicago, the Inland Empire, Kansas City and Boston rank among the top markets for square footage under construction.

Click here to view NREI’s ‘An Overview Of The Medical Office Market Slideshow’. This gallery takes a look at the fundamentals in the top 30 markets ranked by vacancy rates as of the second quarter of 2018, but also includes stats on net absorption, asking rents and the amount of space under construction in each market.

 

Source: NREI