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Feature Story: More net lease buyers turning to HRE

Yield-hungry investors are developing a taste for medical assets, panelists say

By John B. Mugford

Global Medical REIT recently acquired the single-tenant 99,718 s.f. Dumfries Health Center in Dumfries, Va. (Photo courtesy of Fort Belvoir Community Hospital)

The Globe Street (GlobeSt.com) Net Lease Conference, which has been held for two decades, typically has a heavy emphasis on the retail real estate sector.

However, in recent years, the conference has added a session on the net-lease healthcare real estate (HRE) space, as the organization notes “the future is bright for this property type.”

“This conference has generally been retail over its history,” said Matthew Bear, CEO of Las Vegas-based Bear Real Estate Advisors, a real estate investment services firm that has done plenty of work in HRE. “Five years ago, nobody was talking about medical; three years ago, it was a little more. But now today, although we’re the last panel (of the conference), we still got invited to the party because I think … everybody’s searching for yield. Maybe they’re searching for retail replacement, and maybe it’s just a new line of business.”

Mr. Bear made his comments last Thursday while acting as the moderator of a panel focused on medical office buildings (MOBs) and HRE facilities during Globe Street’s conference, which, like most other events, went virtual this year amid the COVID-19 pandemic.

Also on the panel were Alfonzo Leon, chief investment officer with six-year-old Bethesda, Md.-based Global Medical REIT (NYSE: GMRE), and Jon Foulger, director of acquisitions with Dallas-based MedProperties Realty Advisors LLC, a 13-year-old private equity firm that invests in HRE facility acquisitions and development projects.

Much of the discussion focused on

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