Institutional Property Advisors Brokers $10.65 Million Sale of Single-Tenant Medical Office Building in Rural Kentucky
POWDERLY, Ky., May 2, 2017– Institutional Property Advisors (IPA), a division of Marcus & Millichap specializing in serving institutional and major private real estate investors, announced the sale of a 56,500-square-foot, single-tenant medical office building in Powderly, Ky., for $10.65 million. Located at 1010 Medical Center Drive, the facility will continue to operate as a multi-specialty Baptist Health medical center.
“Investors continue to see value in health care real estate – including assets in rural areas like Powderly – as providers move services to outpatient settings in an effort to drive down costs and improve patient accessibility,” said Gino Lollio, senior director, Institutional Property Advisors (IPA) Healthcare, a division of Marcus & Millichap specializing in serving institutional and major private real estate investors. “On this sale, we were able to harness our expertise in the health care field to help the buyers understand complex physician non-compete language, as well as the strategic nature of the site despite its location outside a major metropolitan market.”
Lollio and Scott Niedergang, also a senior director at IPA Healthcare, represented both the buyer, a health care real estate development company, and seller, a physician group affiliated with Baptist Health. Aaron Johnson, first vice president of investments, is Marcus & Millichap’s broker of record in Kentucky.
The Powderly building was developed by the physician group in 2005, before its affiliation with Baptist Health. The practice was subsequently acquired by Trover Health System, which in turn was acquired by Baptist Health in 2012, increasing the credit of the property’s sole tenant. Today, it is part of Baptist Health’s network of seven hospitals, health centers and physician offices, offering care in Kentucky, Illinois and Indiana.
“Physician groups that both own and practice out of their facilities continue to turn to our team for our depth of relationships and expertise in the industry,” Niedergang said. “Prior to marketing the property for sale, we spent 18 months consulting on lease negotiations with Baptist Health. By helping the seller extend a short-term lease to a 10-year lease, with annual rent escalations, we were able to maximize the value of the property on behalf of buyer and seller.”
Lollio and Niedergang, a leading team within the IPA Healthcare, have executed more than 90 healthcare real estate transactions valued at approximately $610 million to date. They exclusively focus on advising physician practices, health systems, investors, and developers on the disposition and acquisition of healthcare properties nationwide and have consistently ranked among the most active healthcare real estate brokerage teams in the country. To learn more about Lollio and Niedergang’s specialized service in the healthcare real estate market place, please visit www.healthcarerealestate.com.