Fidelis Healthcare Partners, which will concentrate on new development and acquisitions, has also secured a prominent capital partner: a state retirement fund advised by Bentall Kennedy
Former Trammell Crow/CBRE executives Kevin O’Neil (left) and Mark C. Allyn (right) have launched a new business unit of Fidelis Realty Partners – Fidelis Healthcare Partners – along with joint venture partner Bentall Kennedy.
DALLAS and HOUSTON, Oct. 31, 2018 – Kevin O’Neil and Mark C. Allyn, who each have more than 30 years of diverse commercial real estate experience, have launched Fidelis Healthcare Partners. This venture will leverage these two executives’ 20 years of providing leadership in the creation and growth of both Trammell Crow Company and CBRE’s healthcare businesses.
Fidelis Healthcare Partners will focus on developing and acquiring high-quality medical properties both on and off campus for preferred client relationships. As an affiliate of Houston-based Fidelis Realty Partners Ltd., the new venture will also leverage that firm’s retail portfolio and expertise to capitalize on the growing trend toward the “retailization” of healthcare. Their tagline, “Real estate at the intersection of Healthcare and Retail” highlights their unique expertise in each product in an increasingly active segment.
Whether developing or acquiring healthcare real estate assets at traditional locations or in more retail-oriented sites, Fidelis Healthcare Partners will be able to capitalize the venture through a formalized investment program with Bentall Kennedy, a prominent real estate investment manager with experience in the healthcare sector. Mr. O’Neil and Mr. Allyn executed the venture documents in August to create Fidelis Healthcare Strategic Partners.
Leveraging healthcare-retail synergies
Mr. O’Neil and Mr. Allyn are excited for their new venture to be affiliated with Fidelis Realty Partners, which has been in operation for over 15 years, and which owns a portfolio of over $3 billion in retail assets across the Southwestern United States with their primary holdings in the Houston and Dallas-Fort Worth markets.
“We have known and respected the Fidelis principals for decades and there are very good synergies between the firm and our new healthcare venture,” says Mr. O’Neil, President and CEO of Fidelis Healthcare Partners. “Fidelis Realty Partners owns a lot of retail property with strategically located developable land in both the Houston and DFW markets. As the retailization of healthcare continues, those retail locations might very well prove to be ideal for healthcare projects large and small.
“What makes for good retail generally makes for a good payer mix and a good healthcare location.”
Alan Hassenflu, President and CEO of Fidelis Realty Partners Ltd., says that the new unit enables his firm to capitalize on healthcare users’ growing interest in retail locations.
Alan Hassenflu, Co-founder, President and Chief Executive Officer of Fidelis Realty Partners, agrees.
“Our firm’s leadership recognizes that healthcare providers and their patients have a growing interest in our retail properties. We are experiencing a substantial increase in demand from medical users whether inline or on pad site locations. We’ve even experienced major users such as a 70,000 square foot multi-specialty clinic tenant in one of our Houston centers. We see this trend continuing and expanding.” he says.
“To capitalize on this trend and become a market leader in healthcare, we saw a substantial opportunity to partner with two well-known healthcare experts who shared a common vision, values, and background with the Fidelis Realty leadership team. We hope to be thought leaders in defining what this intersection looks like.””
A ‘startup’ more than fifteen years in the making
Mr. O’Neil joined Trammell Crow Company in 1987 and was a founding partner of that company’s healthcare real estate and development business, Trammell Crow Healthcare Services, in 1999. In 2004, he helped launch Partners Health Trust (PHT), a subsidiary of Trammell Crow Company. Mr. Allyn, who joined Trammell Crow in 2001, was also involved with PHT from its inception and ultimately served as President and Chief Investment Officer.
From 2004 through 2015, Mr. Allyn and Mr. O’Neil teamed on many healthcare pursuits and developments to build a substantial business. Mr. Allyn managed and led the growth of PHT (Partners Health Trust) which focused primarily on new development and select acquisitions to assemble one of the highest-quality medical office building (MOB) portfolios in the nation.
So when the 17-asset, 1.4 million square foot PHT portfolio was sold earlier this year, it was an opportune time for everyone involved to consider a new venture. After long-standing, productive careers at Trammell Crow Company/CBRE, Mr. O’Neil and Mr. Allyn were ready for a new challenge. Bentall Kennedy and its client were also interested in partnering again due to their belief in the sound fundamentals of medical real estate and the capabilities of the Fidelis Healthcare Partners leadership team. Bentall Kennedy’s interest was enhanced by the connection to Fidelis Realty with its established team and successful operating history. And, as noted above, Fidelis Realty Partners recognized the growing opportunities for synergies between its existing retail real estate business and a new healthcare unit. All of the ingredients of a successful new venture with a unique market capability seemed to be in place.
“Fidelis Healthcare Partners is a startup that has been more than 15 years in the making,” says Mr. Allyn, Chief Investment Officer with the new firm. “Our extensive healthcare real estate experience and relationships, combined with the retail experience of Fidelis Realty Partners, enable us to bring outstanding results to our healthcare clients and our investors.”
Longtime PHT Investment Holdings partner Clint Hinds, a Senior Vice President with Bentall Kennedy, agrees.
“Mark and Kevin were instrumental in the ability of Bentall Kennedy to accumulate the high-quality Partners Health Trust MOB portfolio, which was acquired and developed during a 12-year period and sold in February 2018,” Mr. Hinds says.
“Their expertise and effectiveness in the areas of acquisitions and development, coupled with our ability to actively manage to maximize cash flow, enabled us to amass this premier portfolio which, at the time of its sale, consisted of 17 MOBs totaling 1.4 million square feet in leading U.S. markets.
“We are excited to work with Mark and Kevin on their new Fidelis venture. They are trusted, proven partners and we look forward to another successful collaboration that will benefit everyone involved.”
“We have a substantial first-round equity allocation from Bentall Kennedy and its client for Fidelis Healthcare to develop and invest in creating a quality portfolio of medical real estate properties,” says Mr. Allyn.
“This is much more than a one-off joint deal,” Mr. O’Neil adds. “This will be an ongoing, programmatic healthcare real estate development and acquisition JV partnership with a significant amount of capital to be deployed as we uncover opportunities. While similar in concept to PHT, our go-to-market will be considerably more flexible and entrepreneurial on location and type of medical product. It will also undoubtedly have more of a retail flavor given the strong Fidelis Retail connection. We will strive to deliver tailored, hands-on solutions to hospital systems and healthcare providers where we are known and trusted.”
The principals of Fidelis Healthcare Partners say they are excited about the future of their new healthcare business, which – as a private, intentionally smaller firm – will enable them to be both more selective about the projects they take on while remaining very hands-on in their execution.
About Fidelis Realty Partners Ltd.
Fidelis Realty Partners Ltd. (FRP) is a full-service real estate firm that develops, acquires, owns and manages real estate assets through the Southwestern United States. FRP was established in Houston, Texas in 2003 by Alan Hassenflu and Lynn Davis. FRP has made its mark in retail real estate with nearly 70 properties across 10 cities and four states in the Southwest. FRP’s commercial retail portfolio under management has grown rapidly from 1 million square feet in 2003 to 11 million square feet today. FRP is also a long-term owner with 7.2 million square feet of owned assets and 2.3 million square feet under development with an estimated portfolio value of $3 billion. FRP has over 70 employees engaged in delivering the full complement of value-add real estate services to their portfolio. This includes accounting, development, leasing, legal, project management and property management. For additional information, please visit frpltd.com.
About Fidelis Healthcare Partners
Fidelis Healthcare Partners is a full-service healthcare real estate firm focused on delivering relationship-based services to prominent hospital systems and physician groups across the country. Fidelis Healthcare Partners’ core business will be the long-term ownership of hospital sponsored medical real estate both on campus and off. This ownership will occur either through the development or acquisition of real estate assets, whether individually or as a portfolio. The focus on relationships, equitable deal structures, and consistently outperforming expectations will be the foundation of attaining long-term, loyal customers. This philosophy has consistently produced recurring assignments and strong relationships for the Fidelis Healthcare Partners leadership team at over 20 of the 100 largest hospital systems in the nation over the last two decades.
The Fidelis Healthcare Partners team is led by three principal-level experts with extensive healthcare expertise and relationships. Their background in healthcare real estate includes medical acquisitions and development including construction, ownership, entitlements, capital market structure, and ongoing leasing and management.
For further information about Fidelis Healthcare Partners, please visit frpltd.com.
About Bentall Kennedy
Bentall Kennedy, a Sun Life Investment Management company, is one of the largest global real estate investment advisors and one of North America’s foremost providers of real estate services. Bentall Kennedy serves the interests of more than 550 institutional clients with expertise in office, retail, industrial and multi-residential assets throughout Canada and the U.S. Bentall Kennedy’s Investment Management group has approximately $48 billion (CAD)/$36 billion (USD) of assets under management (as of June 30, 2018). Bentall Kennedy is one of the largest real estate services providers in Canada, managing more than 60 million square feet on behalf of third-party and investment management clients (as of June 30, 2018). Bentall Kennedy is a member of UN PRI and a recognized Responsible Property Investing leader ranked among the top firms around the globe in the Global Real Estate Sustainability Benchmark (GRESB) for the seventh consecutive year since GRESB was launched.
Bentall Kennedy includes Bentall Kennedy (Canada) Limited Partnership, Bentall Kennedy (U.S.) Limited Partnership and the real estate and commercial mortgage investment groups of certain of their affiliates, all of which comprise a team of real estate professionals spanning multiple legal entities. The assets under management shown above include real estate equity and mortgage investments of the companies within Bentall Kennedy.
For more information, visit www.bentallkennedy.com
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