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Plano Medical Office Building Attracts New Physician Groups With Planned Renovations

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Transwestern Real Estate Services announces US REO Fund, a Plano-based real estate investment firm, has selected Transwestern to provide leasing support for 7000 W. Plano Parkway, an 80,000-square-foot, two-story medical office building in Plano.

Formerly known as Plano Pediatric Medical Pavilion, the property will undergo landscape, lobby and common area renovations and rebrand as Prestonwood Medical Center targeting multiple medical specialties in addition to pediatrics. The building features an operational surgical center as well as gastroenterology practices on the first floor.

In addition to general pediatric specialties, the building formerly housed a sports medicine and orthopedic practice and a sleep apnea practice. Spaces ranging from 1,700 to 9,700 square feet are available across the entire second floor.

Built in 2005, Prestonwood Medical Center includes 6 per 1,000 parking and is directly across the street from Prestonwood Baptist Church and Hebron High School. With proximity to The Shops at Legacy, The Clubs of Prestonwood and large system medical campuses, the building offers physicians and patients nearby amenities that support daily operations.

According to Transwestern research, the Dallas-Fort Worth medical office market finished 2021 with positive momentum. Healthcare users continue to absorb space, bringing vacancy rates down to their lowest levels since 2018. As a result, rent growth has accelerated as tenants compete for a shrinking pool of available space. Triple net rents are up 4.1% from last year, nearly double the average growth rate.

 

Source: REjournals

Turner Construction Completes Denver’s Behavioral Health Solutions Center

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Turner Construction has successfully completed the new Behavioral Health Solutions Center on behalf of the City and County of Denver.

The architect for the project was Davis Partnership Architects. Turner provided preconstruction and construction services, including interior demolition and build out to support conversion from a family crisis center to a mental health support facility to be operated by the Mental Health Center of Denver (MHCD).

(PHOTO CREDIT: Brad Nicol Photograph)

The 28,741-square-foot facility is located at 2929 W. 10th Avenue in Denver and is designed to accommodate patients in crisis for brief inpatient stays on the first floor, transitioning to treatment of up to thirty days on the third floor. The program includes reception and common areas, laundry facilities, 46 bedrooms with exterior windows, nurse stations, restrooms and showers, private client meeting rooms, exam space, kitchen and dining space, gymnasium, and administrative support areas. The bottom floor of the facility features anti-ligature fixtures and other components typical for mental healthcare.

“We’re honored to complete another successful project on behalf of the City and County of Denver and provide a modern facility to accommodate people in crisis,” said Eric Erickson, project manager, Turner Construction. “Our team takes great pride in understanding the unique needs and nuances of every project we work on, and it results in buildings that fulfill the vision of our clients.”

 

Source: Mile High CRE

Medical Real Estate Still The Best Way To Keep Your Portfolio Healthy

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In 2018, the JSE’s SA listed property index dropped 25%. In 2019, the total return from the index was 1.92%, well below inflation. In the first five months of 2020, the index shed 39%.

Although dividends from listed property grew by 8-12% a year between 2014 and 2017, growth slowed to 3.5% in 2019, which again was below inflation. In response to the economic fall-out from Covid-19, many property companies have warned they will withhold dividends this year to strengthen their balance sheets and until they understand the full fallout from the pandemic.

The data is not looking encouraging.  Office tenants are cutting space wherever possible, having learned that their reduced workforce can work from home. Retail is under enormous pressure across the board, from the legendary brands like Edgars to the smaller independent brands, and restaurants that just don’t have the fire power to recapitalise and pay rents in a market where there are still restrictions and the consumer is unable to come to the rescue.

What’s more, if you are in the hotel and hospitality industry, then there is really no clear path to recovery at this stage and the losses will be devastating.

There’s no refuge in residential property, either. The Lightstone Residential Property Index shows national house price growth in SA peaked at 6.25% in 2014 and has slowed since then to a five-year low of 1.7% in 2019. Lightstone expects, despite the recent interest rate cuts, that growth in the residential housing market will slow again in 2020.

Two specialized sectors of the property market have continued to deliver solid returns throughout the Covid-19 crisis. Logistics is one of the winners due to online e-commerce stores which have enjoyed a surge in online shopping.

The other big winner globally is medical office buildings, whose tenants mostly offer essential services. Even those who had been required to close are already benefiting from a post-lockdown surge in patient visits as medical procedures can, in most cases, not be postponed indefinitely. Think for a moment about your dentist, who will still need to attend to those fillings even if he could not see you over the last three months.

For South Africans who invested in offshore logistics or medical buildings, the rand returns have been considerably enhanced by the latest depreciation of the rand against the dollar.

In the US, the Covid-19 crisis has hit particularly hard, with 134,000 deaths by early July, amid total confirmed cases exceeding three million. Hospitals under pressure to clear wards and scale up for the anticipated flood of Covid-19 patients have had to postpone all elective procedures and turn patients away who were not critical.

This dramatically affected the income of all medical professionals who are not directly involved in treating Covid-19 patients, and has also affected hospitals’ revenue. Even as the US emerges from lockdown, patients choose to avoid traditional hospitals in fear of being exposed to the virus. This has been a boost for medical practitioners working outside the hospital systems, as patients have sought treatment from doctors working from these independent facilities.

Orbvest, which has 19 medical office buildings under management in three US states (Texas, Georgia and New Jersey), noted rental collections declined slightly in April, during lockdown, as about 21 tenants across the entire portfolio of over 100,000 square meters requested deferment.

But by end-June, the net collection of rentals was back to 97.6%, as both Texas and Georgia re-opened their economies, and collections for the month of July already are close to normal. The nett result of the pandemic on our projected revenue will be negligible and we expect to have fully recovered before year end.

Medical property investment was not an unexpected beneficiary of the Covid-19 crisis. The argument for buying into a building tenanted by medical professionals, especially in the US, makes fundamental sense in the long term. In the US, the aging population is growing and requiring more medical care. An investment delivering a proven 8% p.a. in US dollar dividends paid quarterly, plus a capital gain share at the end of the investment period, is an essential part of a diversified portfolio for South African investors.

 

Source: Daily Maverick