ROME, GA-One of the larger medical office building transactionsof 2012 involved the sale of seven buildings owned by a largephysician practice in northwest Georgia. During Q4 2012, the150-year-old, 140-doctor Harbin Clinic of Rome, GA sold sevenbuildings for $90 million to Indianapolis-based Duke Realty Corp.Not only was the sale one of the largest healthcare real estatetransactions in 2012, but it was also one of the largestprovider-driven sales, otherwise known as monetizations, of thepast decade. According to our research, the deal was in the top 10provider monetizations since Healthcare Real Estate Insights wasfirst published in 2003.

During a panel discussion concerning provider monetizations at arecent healthcare real estate conference, Kenneth Davis, presidentof Harbin Clinic, was on hand to give insight into how the dealtook place and why Harbin decided to sell the buildings. Harbinfirst began considering the possibility of selling most of itsbuildings late in the 2000s, at about the same time healthcarereform was being enacted.

“For one thing, we knew (under reform that) revenue was going todecrease in time, which was going to lower our operating margins,”Davis said. “We also knew that we were going to have significantand new capital expenses,” including expanding its electronicmedical records, building an accountable care model, and recruitingphysicians in order to compete with other systems.

Continue Reading for Free

Register and gain access to:

  • Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.