In an article published in the November edition of Real Estate Forum Magazine, HSA PrimeCare senior vice president of acquisitions and development, Jon Boley, outlines the complexities of acquiring and renovating obsolete medical office buildings. Boley discusses the challenge of smaller floorplates, originally built to accommodate medical practices with one or two physicians and the changes in the strategic needs of today’s physician offices.
Jon E. Boley, SVP
“Consolidation of physicians over the past several years has increased demand for space suitable for the larger multi-specialty practices common today,” said Boley. “Owners and developers are constructing new buildings with larger floorplates, and on-campus medical space is being heavily renovated to fit the needs of today’s healthcare providers…”
Boley also explains the impact of the Affordable Care Act, which has shifted the focus of health care systems from a volume-based healthcare delivery model to a value-based model.
“In order to reduce costs and improve accessibility, health systems are moving more operations off campus to less expensive facilities that are closer to the patient. In some cases, health systems are backfilling vacancies in existing retail centers, many of which offer proximity to residential neighborhoods, as well as ample parking, flexible layouts… and high visibility.”
HSA PrimeCare announced today the firm has completed a lease expansion with Ann & Robert H. Lurie Children’s Hospital of Chicago at Silver Cross Health Center located on the Silver Cross Hospital Campus in New Lenox, Ill.
HSA PrimeCare developed the 53,423 square-foot state-of-the-art medical office building in 2009, and Lurie Children’s Hospital was one of the building’s original anchor tenants. The 130-year-old pediatric care provider will expand into the last available suite in the building starting first quarter 2017. With the additional space on the second floor, Lurie Children’s Hospital now occupies a total of 17,735 square feet in the fully-leased facility.
Since the building’s completion in 2009, HSA PrimeCare has partnered with Silver Cross Hospital on three additional projects on campus, including the University of Chicago Medicine Cancer Center in 2012 and its expansion in 2014, as well as the 30,000 square-foot business center, which HSA PrimeCare completed in January 2015.
Robert Titzer, executive vice president at HSA PrimeCare, represented the landlord in the renewal/expansion transaction with Ann & Robert H. Lurie Children’s Hospital of Chicago.
In a recently published article for Illinois Real Estate Journal, HSA PrimeCare executive vice president Robert Titzer examines the current state of the healthcare real estate market.
Robert Titzer, EVP
“The medical office building market is strong and it is active,” he said. “And the underlying reason for that? There has been a lot of change in the healthcare industry. These changes in the industry, the growth of healthcare in general, has made this an extremely active market today.”
Titzer goes on to elaborate on some of the changes in the industry, including the aging population, the availability of health insurance, and the consolidation of medical practices into larger health systems. He also discusses changes in patient expectations and how healthcare providers are working to improve the convenience of their services.
“There is an effort on the part of healthcare providers to bring their medical services out to where the consumers are,” Titzer said. “They want to make the process more efficient. A hip replacement or a knee replacement that once was done at a hospital can now be done in an outpatient setting. These procedures can be done in some neighborhood in the suburbs. Formerly, that patient had to go downtown or to a hospital in a further-away suburb. Now everything can be done closer to home.”