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Medical Office Building Developers See Opportunities And Expect Project Growth In 2021

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Although medical office buildings (MOBs) are once again showing their strength as an investment and ownership product during the COVID-19 pandemic, some professionals involved in the sector have expressed concern that there could be a slowdown in the development of such facilities in the next couple of years.

Although such a concern could indeed prove to be true, professionals with some of the MOB sector’s largest and best-known development firms, as well as full-service healthcare real estate HRE) firms that provide development services, recently expressed that they are remaining as busy as ever, and should be for at least the next year or longer.

HREI™ Editorial Advisory Board members say the number of requests for proposals (RFPs) and the level of development activity during the COVID-19 pandemic have come as a pleasant surprise, and they say they expect 2021 to be another strong year.

 

Source: HREi

Medical Campus In Highlands Ranch Colorado Sells For $33.5 Million

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A sought-after three-building medical office campus in the heart of Highlands Ranch sold for $33.5 million to a real estate investment trust specializing in medical office properties.

Healthcare Realty, under the name Ridgeline Medical LLC, according to public records, purchased the Ridgeline Medical Campus at 9135, 9137 and 9139 S. Ridgeline Blvd. It was sold by Bancroft Capital, which paid $21.25 million for the campus in 2016.

Comprising 136,994 square feet, Ridgeline was 93% leased to tenants, including Children’s Hospital Colorado, Centura Health and Kaiser Permanente.

The campus is located near the UCHealth Highlands Ranch Hospital, which opened in June 2019, and Children’s Hospital Colorado South Campus, Highlands Ranch, which opened in January 2014. As well, Ridgeline is located adjacent to the Highlands Ranch Town Center, which offers a variety of retail amenities.

Constructed in 2001 as a suburban office park, the buildings were converted to medical office to meet the demand for the product type in the market and is one of the few outpatient medical office campus locations near the two hospitals in Highlands Ranch.

Ridgegate Medical Campus’ on-site amenities include a fitness center, showers and lockers, outdoor seating and a conference room.

CBRE’s Chris Bodnar, Lee Asher, Ryan Lindsley, Tim Richey and Charley Will represented the seller.

“The deal received a significant amount of interest from medical office investors across the country who saw the opportunity for full medical conversion at higher rents, as well as the three anchor tenants,” said Bodnar.

The buyer was able to close within a week of signing the purchase and sale agreement, all cash.

Bancroft, a privately held real estate investment firm based in Manhattan Beach, California, also owns Highland Ranch I & II, a two-building, 152,208-sf office complex at 630 and 640 Plaza Drive, as well as Sixth Avenue West, Denver Highlands and a number of other Colorado assets.

Ridgegate represents the latest addition to Healthcare Realty’s Denver area portfolio, which at year-end totaled 651,237 sf.

 

Source: Colorado Real Estate Journal