Sule Aygoren Carranzais managing editor ofRealEstate Forum.

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NEW YORK CITY-Cushman & Wakefield has formed a formal unitdedicated to firms involved in various sectors of the healthcareindustry. The Healthcare Practice Group will provide services forsenior housing and healthcare investments; hospitals and healthcarepractice groups; healthcare payors, plans, and specialty services;and medical and academic properties.

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The creation of the Healthcare Practice Group, says NormanLeZotte, a C&W managing director and co-chair of the HPG, wasactually spurred by its clients. "We had several clients that werein the seniors housing business that we were providing a variety ofservices for," says the Atlanta-based executive, adding that thesefirms were scattered throughout the US and Canada. It was theseclients that brought us the idea of formalizing the services theyalready provide in a group. "Cushman & Wakefield took that ideaand ran with it."

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In addition to acquisitions and dispositions, the HPG willhandle property management, debt and equity placement arrangement,valuation and consulting work, and corporate services for itsclients. C&W provided all of those services before, saysLeZotte, but this time, "operators and developers and investors canhave a one-stop shop and deal with a team that's dedicated tohealthcare.

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"Basically, the original idea behind the group was to allow anoperator or a healthcare company to use this as a single point ofcontact," he continues. "We can provide real estate services tothem; we can deal with the corporate side of the coin, because weunderstand their business. Our goal is to make sure we're meetingtheir needs in an organized fashion. We want the healthcareoperator to be able to focus on its business operations and allowus to handle the real estate needs." Having everything under oneumbrella, LeZotte adds, allows the client to work with one entityfrom start to finish, from development or acquisition, to financinglong-term debt to disposition.

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The unit is led by an eight-member executive committee thatincludes LeZotte; Michael Berne of New York City; Mark Gallagher inVancouver; Gary Glatter and Richard Taylor in McLean, VA; GaryHooper of Richmond, VA; Bryan Johnson of Phoenix; and Frank Nelsonin Boston.

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Several of the HPG's members, who have experience in businessconsulting, valuation, investment sales, capital markets, propertymanagement and brokerage, have worked on the operational side ofthe business. The group is comprised not only of existing C&Wprofessionals, but also executives from seniors housing operators,acute care providers, health insurance companies, and the like.

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"Healthcare real estate is more of a business function thananything else, so you need to understand how that operates in orderto maximize real estate returns," LeZotte explains, adding that thegroup currently has about 80 members.

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In addition to client requests, however, the future direction ofthe seniors housing and care market provides ample opportunitiesfor the firm. The large, aging Baby Boom population coupled withlonger life expectancies will make these services critical goingforward, and the industry itself has room for significantgrowth.

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"I've personally been in the seniors housing business since theearly 1990s, and the industry is becoming very sophisticated. WallStreet is involved in it and there's a lot of foreign capital thatcomes into the sector," says LeZotte. "It used to be the operatorsreally didn't understand the real estate underneath them--what typeof equity they had and how they could use their real estate toachieve their operational goals. What I see in the business rightnow is senior housing is going to play a major role--there's a lotof development and a lot of need for nursing home care in thiscountry. But overall, healthcare is a need-based system. It's goingto continue to grow, and there's also a huge amount ofspecialization going on."

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If C&W's business to date in the sector is any indication,the HPG will have its hands full. Over the past 12 months, the firmhas raked in slightly more than $25 million in fees from businessin the sector alone. Further, C&W's healthcare valuation teamperformed more than 1,200 valuation and consulting assignments in2007 for more than $2 billion worth of properties.

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