Newmark Arranges $300 Million Joint Venture With Catalyst Healthcare Real Estate And Heitman To Fund MOB And IRF Development Pipeline

Newmark announces it has arranged a strategic joint venture to fund a $300 million development pipeline of purpose-built healthcare properties.

The venture is between Catalyst Healthcare Real Estate–a leading healthcare real estate development and investment firm in the US, who has developed and invested in approximately four million square feet of healthcare real estate over its 13-year history–and Heitman, a $50 billion real estate investment management firm that invests in equity and debt across all real estate property types including healthcare real estate.

Catalyst and Heitman have entered a joint venture to develop a national portfolio of healthcare properties, including both medical outpatient buildings, orthopedic centers of excellence, and inpatient rehabilitation facilities. The venture will start by funding the development of seven, ground-up or in-process developments–totaling nearly 500,000 square feet, spanning five states and encompassing blue chip tenants such as Ochsner Health, Andrews Medicine, University of Mississippi Medical Center and PAM Health.

“Catalyst seeks to be a good partner to healthcare by working in partnership with its clients to design a comprehensive real estate solution that best supports their mission, vision, and values, providing better access to care, higher quality outcomes and lasting relationships,” said Chad Henderson, Founder/CEO and Managing Partner of Catalyst Healthcare Real Estate.

“The joint venture with Catalyst is another significant milestone in Heitman’s 20+ year history of investing in the medical office sector,” said Brian Pieracci, Head of Private Equity – North America. “We are excited to have formed this new partnership with Catalyst, one of the leading operators in the space. We believe medical office is appealing due to its defensive, counter-cyclical qualities as a needs-based asset class. It benefits from secular demand drivers, including the aging of the US population and migration of medical services out of hospitals and into outpatient settings. We believe the properties in the Catalyst portfolio are attractive investments due to the high acuity and strategic uses in the buildings for their major health system tenants.”

Newmark’s Healthcare Capital Markets Group represented Catalyst on the development pipeline capitalization and advised both, Catalyst and Heitman, on the establishment of the joint venture. The transaction was led by Newmark Executive Managing Director Ben Appel, Senior Managing Directors John Nero, Executive Managing Director Jay Miele, Senior Managing Director Michael Greeley, and Associate Director Ron Ott.

“Catalyst prides itself on its people, its promise, and the quality of its work. CEO, Chad Henderson, the Catalyst organization, and the healthcare properties it has developed have been recognized nationally for the quality of its people and development projects,” noted Appel. “Working with Heitman further solidifies Catalyst’s business plan to execute the ambulatory strategy and support the growth of many of the nation’s leading providers.”

About Newmark

Newmark Group, Inc. (Nasdaq: NMRK), together with its subsidiaries (“Newmark”), is a world leader in commercial real estate, seamlessly powering every phase of the property life cycle. Newmark’s comprehensive suite of services and products is uniquely tailored to each client, from owners to occupiers, investors to founders, and startups to blue-chip companies. Combining the platform’s global reach with market intelligence in both established and emerging property markets, Newmark provides superior service to clients across the industry spectrum. For the year ended December 31, 2023, Newmark generated revenues of approximately $2.5 billion. As of March 31, 2024, Newmark’s company-owned offices, together with its business partners, operate from approximately 170 offices with 7,600 professionals around the world. To learn more, visit nmrk.com or follow @newmark.

About Catalyst Healthcare Real Estate

Catalyst is a national healthcare real estate development and investment firm. Our platform of integrated real estate deliverables is specifically designed for the ever-evolving landscape of healthcare real estate. Our team seeks to positively impact healthcare with strategic investment in development, acquisition, and strategy services. For more information, please visit catalysthre.com.

About Heitman

Heitman is a global real estate investment management firm with $50 billion in assets under management as of March 2024. Founded in 1966 and headquartered in Chicago, Heitman has 10 offices worldwide and is an active participant in the global real estate property and capital markets. Heitman makes real estate investments through private equity, debt, and publicly-traded real estate securities.

Source: HREI