Value-add MOB includes medical conversion; Avison Young was the broker
By John B. Mugford
Due to rising interest rates and the tight lending market, getting deals done in today’s market can be challenging in any commercial real estate (CRE) asset class – even the ever-resilient healthcare real estate (HRE) sector.
As a result, the investors and brokers who do manage to get deals done these days often have interesting stories to tell, as not many of the sales are cookie-cutter transactions by any means.
Such was the case with a deal that closed in March in Sewell, part of Washington Township in a large suburban area in New Jersey south of Philadelphia.
There, Atkins Companies, a longtime CRE firm that in the years since its founding in the 1970s has become increasingly engaged in the HRE sector, acquired the two-story, 70,140 square foot Washington Medical Arts Building at 405 Hurfville-Crosskeys Road.
According to Arnold, Md.-based RevistaMed, an HRE data service, West Orange, N.J.-based Atkins paid $13.25 million, or $189 per square foot (PSF). The seller was an affiliate of The Gordon Group of Linden, N.J., the 60-year-old development and construction firm that had built the facility in 2009.
The Washington Medical Arts Building contains medical offices that are almost fully leased and include some of the area’s best-known providers, including: Marlton, N.J.-based Weisman Children’s, which provides inpatient and outpatient pediatric rehabilitation services; Rowan Medicine, a primary care multispecialty group with seven locations in New Jersey; Select Surgical Center, which is operated by local surgeons in an affiliation with Dallas-based United Surgical Partners International, a unit of Tenet Healthcare Corp. (NYSE: THC); and Philadelphia-based Jefferson Health, which operates 18 hospitals and numerous outpatient centers throughout the region.
The building also includes a gym and fitness center of about 32,000 square feet – and therein hangs the tale.
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