November 1, 2023 9:00 AM
Newmark announces the sale of Richardson Medical Center I (“RMC I”), a 118,472-square-foot medical office building in Richardson, Texas. The property is located at 3101 E. President George Bush Highway, a quarter mile south of Renner Road. The asset sold for an undisclosed amount.
Newmark Vice Chairmen Chris Murphy, Robert Hill and Gary Carr, Senior Managing Director John Nero and Executive Managing Director Ben Appel in cooperation with Senior Managing Directors Jay Miele and Michael Greeley represented the seller, Pillar Commercial. The buyer was Big Sky Medical.
Situated on President George Bush Highway, the asset is directly adjacent to Methodist Richardson Medical Center, a premier acute care hospital campus in Dallas-Fort Worth consisting of 334 beds, a physician office building, an emergency room and a cancer center. RMC I is undergoing a transformation from a traditional commercial office to clinical medical use.
“Richardson Medical Center I is uniquely positioned to capture the growing demand for medical office space in the market given its strategic location next door to Methodist hospital, high-quality infrastructure, ample parking and space availability,” said Murphy.
Built in 1998 and renovated in 2017, the property comprises two floors with a parking ratio of 6:1,000. The building was fully leased as of February 2023, before a long tenured anchor tenant vacated. The recent turnover provided the first-ever conversion opportunity at RMC I, a strategy successfully implemented at a neighboring property consisting of similar architecture, floorplates and quality.
In 2019, Pillar Commercial purchased Richardson Office Center I & II, a 240,000 RSF two-building office complex, with the intention of converting the assets to healthcare uses. Soon after purchasing the assets, Methodist Richardson Medical Center acquired Richardson Office Center II from Pillar to accommodate the hospital’s continued expansion of the main campus. Earlier in 2023, Pillar began a medical office conversion and rebranded the remaining property to RMC I. Pillar simultaneously elected to test the market to see if an acceptable offer could be attained from MOB investors.
“This sale represents our second successful realization out of Pillar Real Estate Fund I, and we applaud Newmark for their exceptional execution,” said Manny Ybarra, Founder and CEO of Pillar Commercial. “We are equally confident Big Sky Medical will be effective in continuing this strategic MOB conversion.”
“Our team is proud to be a part of this transaction, which leveraged the breadth of the Newmark platform to combine both market expertise and national healthcare experience to deliver the best outcome for our client,” added Nero.
Dallas-Fort Worth office-using employment continues to remain near historical high at the end of August 2023. The metroplex reported 1.28 million office workers, an increase of 67.6% compared to 2010 and an increase of 21.5% compared to 2019 employment levels, according to Newmark Research. The continued strength and growth in the market’s office employment reflect an enduring appetite for office assets. The Dallas-Fort Worth office market’s long-term outlook remains positive and competitive given the market’s strong economic fundamentals, such as a diversified labor pool and continued office-using jobs growth.
About Pillar Commercial
Formed in 2004, Pillar Commercial is a Dallas-based vertically integrated investment management and operating platform. 100% minority-owned, Pillar is led by a seasoned and cycle-tested investment management team with significant institutional experience and proven track record. The Dallas based company has acquired more than $630 million in commercial property through various joint-venture partnerships with institutional investors and family offices.
About Big Sky Medical
Big Sky is an investment manager focused on commercial real estate across the United States with an overweight focus on the healthcare sector. Over the past 15 years, its principals have invested in over 7 million square feet of healthcare property valued at a total cost of over $2.20 billion. Big Sky was formed in 2020 by industry veteran Jason L. Signor to exclusively invest in healthcare and life science real estate.
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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