October 24, 2023 9:00 AM
Newmark announces it has completed the sale of a medical outpatient building collection comprising two properties located in Rockville and Pikesville, Maryland. Totaling a combined 200,000 square feet, the 98% leased MOB collection traded from Harrison Street to Hines’ flagship commingled U.S. core plus fund, Hines U.S. Property Partners Fund (“HUSPP”).
Newmark Healthcare Capital Markets Executive Managing Director Ben Appel; Senior Managing Directors Jay Miele, John Nero and Michael Greeley; and DC-based Executive Managing Director Jud Ryan, provided support on the transaction. Newmark Senior Managing Director Ed Goldmeier executed the transaction on behalf of the seller and procured the buyer.
“Both facilities have maintained impressive historical occupancy in the mid 90% range and are mong the busiest MOBs that our team has visited in recent years,” said Appel. “This transaction marks the first MOB acquisition Hines’ has made in its core fund, as part of their intentional and strategic initiative to grow its medical outpatient portfolio and exposure to alternative real estate sectors.” Miele added, “The sought-after collection illustrates a tilt towards well-located, high-quality investments for institutional buyers, an emerging trend in the current economic climate.”
Newmark’s marketing process produced more than a dozen bidders, attracted to the properties’ core and mission critical investment characteristics including long weighted average lease term, compelling contractual annual escalations, and investment grade credit tenancy. An overview of the properties includes:
- The Rockville-located asset is almost entirely leased to Children’s National (Fitch A+)–whose occupied space since the building’s completion–and functions as a comprehensive regional outpatient hub.
- The Pikesville-located asset is a multi-tenant outpatient building and is anchored by LifeBridge Health (Moody’s A2).
“Through the acquisition of CapMed MOB Collection, we are capitalizing on the continued shift to outpatient healthcare with two mission-critical facilities in the 6th largest combined statistical area in the U.S.,” said Andrew McGeorge, Senior Managing Director and city head of the Washington D.C. office of Hines. “This investment diversifies our portfolio and aligns us with a historically resilient and strategically significant asset class.”
The properties are located in dense, in-fill suburban markets, each with a significant institutional presence of universities, academic and research institutions, health systems, and life science/ biotech firms, providing strong market-level fundamentals and long-term demand drivers.
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 ending December 31, 2022, Newmark generated revenues of approximately $2.7 billion. As of June 30, 2023, Newmark’s company-owned offices, together with its business partners, operate from approximately 170 offices with over 7,400 professionals around the world. To learn more, visit nmrk.com or follow @newmark.
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