SAN ANTONIO, TX—With an eye on forming partnerships with firms in various markets nationwide, San Antonio-based USAA Real Estate Co. recently announced that it is teaming with Brackett Flagship Properties LLC of Charlotte, NC, to focus on medical real estate in the Southeast.

USAA says it intends to form four to six more regional partnerships like the one with Brackett Flagship by the end of 2016, giving the institutional real estate investment firm a presence from coast to coast.

“We have had numerous conversations with other firms geographically dispersed across the country and we're trading proposals with them right now,” Rob Sult, a USAA managing director, told Healthcare Real Estate Insights^™ in an interview.

USAA Real Estate and Brackett Flagship say their partnership will focus on the acquisition, development, property management and leasing of healthcare sector properties, particularly medical office buildings (MOBs) and other “mission-critical” health system outpatient facilities.

It will target HRE investments in primary and secondary markets in a five-state area that includes the Carolinas, Tennessee, Georgia and southern Virginia, and will have the financial capacity to consider both acquisitions and ground-up development projects. Within that geographic region, Brackett Flagship is responsible for identifying development and acquisition opportunities, Sult said.

Brackett Flagship, created in 2010 through the merger of Flagship Capital Partners and Diane Brackett Co., is led by managing partners Charles Campbell and Diane Rivers and president J. Brannen Edge III. Independent of the venture with USAA, Brackett Flagship owns and/or manages more than 1.2 million square-feet of healthcare space in 14 sub-markets across North and South Carolina, Virginia, and Tennessee. The firm and its investors have acquired and developed more than one million square feet of healthcare properties in ventures with numerous physician practices and health systems.

As a kickoff for the partnership, USAA-Brackett Flagship is acquiring a portfolio of nine properties with more than 315,000 square-feet in eight cities throughout North and South Carolina, and northeast Tennessee. USAA's Sult declined to specify the properties, but one of those assets is Cotswold Medical Center, a three-story, 38,041 square-foot MOB on about two acres of land at 309 S. Sharon Amity Road in Charlotte.

A similar approach will be used to establish four to six JVs in other regions, Mr. Sult says, with a goal of securing two more partners by the end of this year and achieving full national coverage by the end of 2016.

Founded in 1982 as the real estate investment arm of USAA, USAA Real Estate has more than $12 billion in assets under management and provides co-investment asset management services to U.S. pension funds as well as foreign and domestic institutional investors.

MOBs are a fairly recent addition to the USAA Real Estate portfolio. In recent years the firm partnered with Phoenix-area developer Plaza Cos. on at least two MOB deals, including the 2006 acquisition of the eight-building, 71,508 square-foot Arrowhead Professional Center III in Glendale, AZ, and the 2008 development of the five-story, 104,213 square-foot Paradise Valley Medical Plaza in Phoenix.

Murray W. Wolf is the founder and publisher of Healthcare Real Estate Insights™, the nation's first and only publication totally dedicated to covering news and trends in healthcare real estate development, financing and investment. For more information, please visit www.HREInsights.com.