Companies & People: He’s helped raise HRE to new heights

Jonathan L. Winer receives BOMA’s first Outstanding Contribution Award

By John B. Mugford

For the most part, the healthcare real estate (HRE) sector is less than two decades old, a relatively new asset class that in recent years has become the darling of a growing list of investors both large and small.

Because of its newness, the sector includes among its current and active ranks some professionals who can be considered pioneers, the people who’ve helped medical office buildings (MOBs) emerge from their former status as footnotes among general office statistics.

One of these pioneers was honored with the first Outstanding Contribution Award at the recent 2014 BOMA International Medical Office Building + Healthcare Facilities Conference in Nashville, Tenn.

Jonathan L. “John” Winer, executive VP and chief investment officer of White Plains, N.Y.-based Seavest Healthcare Properties Inc., says he was completely surprised by the honor given to him on behalf of the planning committee by the co-chairs of BOMA’s 2o14 conference, Laca Wong-Hammond and Neil J. Carolan.

“I honestly had no idea,” said Mr. Winer, who was chatting in the networking lounge when one of his Seavest colleagues told him it was time to attend the keynote luncheon.

“I said something like, ‘Yeah, I’m coming, I might be a little late but I’ll be there.’ But Lloyd (Mallah, a Seavest senior asset manager), who had instructions to make sure I was in my seat at the appropriate time, said that we had to go right then because we were at a table near the head of the room and it wouldn’t look good if we came in late. I thought it was kind of strange at the time, but I didn’t know that anything like (the presentation of the award) was even happening. I was certainly very surprised, very pleased and very humbled by it.” At the outset of the lunch, Ms. Wong-Hammond, senior VP and head of healthcare real estate for Raymond James, presented Mr. Winer with the award.

“Healthcare real estate is quite a specialized, niche industry, but as some of you know the sector came into favor some dozen years ago,” she said in announcing the recipient of BOMA’s first Outstanding Contribution Award.

“Before that, healthcare real estate was more of an alternative investment rather than a core real estate asset class. A few pioneers have built the industry, and even fewer can lay claim to (leading) … the sector’s evolution from an investment, development, advisory and financing standpoint. We’d like to honor one of these pioneers today: Mr. John Winer.”

Some might say Mr. Winer was merely in the right place at the right time – stumbling upon the HRE sector just as it was starting to heat up back in 1996 or so, when he was part of the real estate capital markets team at Ernst & Young LLP.

However, others might say he is a big part of the reason the sector began to heat up. He was astute enough to recognize the potential of HRE before most other commercial real estate professionals, and became one of the sector’s champions. For Mr. Winer, the BOMA award is recognition of what he has brought to the sector ever since.

An ‘incredibly underserved’ sector

“As a consulting firm, we were always looking for ways in which we could help our clients, and that included hospitals, identify opportunities,” Mr. Winer recalls of his days at Ernst & Young.

“Prior to this time, we had done these same types of evaluations and transactions, looking at the value locked up in real estate, for corporations, and that’s where the methodology came from to look at monetizing MOBs on the healthcare side.

“We took that process to our healthcare clients, showing them the capital they had locked up in their real estate, and we demonstrated how they could tap into that and what it would mean for their balance sheet and their credit ratings.”

At the time, as Mr. Winer recalls, there were only a “handful or so” of institutional quality capital sources with experience in owning and operating MOBs.

“As we started getting involved in monetizing assets, or finding developers for health systems, what I remember thinking was how incredibly underserved the sector was and how there were so few people and companies focused on helping hospitals understand what they owned and what the possibilities were,” Mr. Winer says.

Needless to say, his early assessment of the sector’s potential was right on the money, and Mr. Winer not only helped educate health systems on how they could use third-party capital to their advantage, but he also introduced many investors to the upside of healthcare real estate.

“John was making transactions happen well before any funds or many investors were allocating capital for MOBs,” noted Ms. Wong-Hammond during an interview.

As everyone involved in the sectors now knows, more and more third-party capital sources, including many institutions, continue to enter the market, chomping at the bit to invest in all types of medical facilities. Billions of dollars are currently allocated for investments in HRE.

While at Ernst & Young, Mr. Winer eventually made the shift to focusing all of his attention on health system clients. In 2008, as Seavest, which had long focused on investing in development projects, was looking to continue with its growth, raise its public profile and develop new relationships with health systems, it hired Mr. Winer to bolster the effort. At the time, the company was making investments through its second fund and raising capital for its third.

Today, Seavest has fully invested the capital from that third fund and is raising capital for and making investments from Seavest Properties IV. For the most part, Seavest invests in a combination of healthcare development projects as well as acquisitions.

Not only has Mr. Winer helped grow the awareness of HRE during his tenures at Ernst & Young and Seavest, but he’s also been heavily involved in the sector’s largest and best-known conference, the annual BOMA event, which had a record setting-attendance of nearly 1,000 people this year in Nashville.

(For more on the reason for the success of the conference, please see, “Another record reached at BOMA Healthcare.”)

While he cannot remember the year in which he first attended BOMA’s fledgling healthcare conference, Mr. Winer recalls that it was in the early 2000s and that attendance was quite small, certainly less than 100 people. Intrigued by the potential of the conference and how it could perhaps instigate growth for the sector itself, he soon became heavily involved in organizing and planning the annual event. By 2007 and 2008, he was chair of BOMA healthcare conferences in New York and Denver.

“I really appreciate the recognition, and in a way I received it for something that has been a labor of love of mine,” Mr. Winer says. “It’s been terrific being involved in a conference that has grown tremendously and has had so much success. To me, the growth of the conference is both a reflection of the success and growth that the industry has experienced as a whole, but it is also because many intelligent and dedicated people have elevated the sector to a very professional, very meaningful level in which the hospitals and health systems have benefitted.”

It is for that reason – to benefit health systems and assist them in their quest to deliver care in the best ways possible – why Mr. Winer has enjoyed, and still enjoys, his profession.

“One of the great things about being in healthcare real estate is that you are involved in one of the most-watched, sometimes most hotly contested, sectors of our society,” he says. “Everyone is passionate about healthcare and how it is paid for and delivered. And being involved in this sector allows me to deal with and provide solutions for the all of the components involved in real estate while also being involved in how we provide healthcare in this country.”

As for the future of healthcare real estate, Mr. Winer says there will undoubtedly be plenty of changes that take place, as the last few years have demonstrated. Some of the future changes, he notes, could take the sector and its companies in directions unforeseen today.

“One of the big changes today is all of the consolidation that’s taking place among providers,” he says. “But as far as I and many others in the business are concerned, it is even more important for health systems today to have access to funds and to have the flexibility to move quickly on acquisition opportunities – so that, in regards to having access to capital, has not changed.

“And while the environment is different today, as are the buildings themselves, than just a few years ago, what hasn’t changed is the fact health systems still need assistance in looking at where opportunities lie.”