HEALTHCARE INFLUENCER: Marcus & Millichap
Marcus & Millichap’s Healthcare Real Estate Group is a prolific team having recently closed more than 200 transactions valued in excess of $1.1 billion.
MARCUS & MILLICHAP’S HEALTHCARE REAL ESTATE GROUP
Marcus & Millichap’s Healthcare Real Estate Group is a prolific team having recently closed more than 200 transactions valued in excess of $1.1 billion. It has another $398.5 million worth of listings on the market. Led by Alan L. Pontius, the advisory practice of more than 50 professionals specializes in medical office building and seniors housing investment sales. The group arranges the sale of healthcare investment properties on behalf of individuals, partnerships, major institutions, developers and hospital systems. To that end, it offers a range of services from property underwriting and valuation to marketing to access to a broad array of financing solutions through Marcus & Millichap Capital Corp.
Marcus & Millichap’s healthcare practice has a deep understanding of the healthcare market and believe that the medical office sector, in particular, has a bright outlook. As SVP and national director of the healthcare real estate group, Pontius oversees executive management of the firm’s 16 specialty divisions including healthcare. Mark Myers and Joshua Jandris, executive managing director and senior managing director respectively, work with both Marcus & Millichap and its Institutional Property Advisors division. They have contributed significantly to the group’s success and even, it could be said, helped to change the landscape of the seniors housing investment advisory community.
When Myers began his career in the healthcare brokerage space 23 years ago, few seniors housing owners knew what a transaction advisor/broker did or how these professionals could add value to a transaction. Instead, when owners were ready to sell, most would simply call another owner in the market—often a friend—and try to put together a transaction on their own. This resulted in low sale prices, lengthy due diligence periods and little to no earnest money by the buyer.
Not surprisingly, many deals died from inertia. Myers began to apply his education and experience as an asset manager for a real estate syndicator to create financial and marketing positioning analyses and recommendations for his clients. He would conduct nationwide searches for qualified buyers, run what amounted to a silent auction for the property while ratcheting up the bids and tightening buyers’ due diligence and closing timeframes. Many of Myer’s clients had no idea such buyers even existed. Over the ensuing years, Myers would close over 550 transactions involving more than 68,000 units and worth $5 billion.
A dozen years ago, Myers added Jandris to the team, who quickly began closing landmark transactions. One was the procurement of a $500 million engagement to sell an entire healthcare company that owned 33 skilled nursing facilities in Texas, along with a construction company, an operating company, ancillary businesses and a home office. It was the largest private client nursing home transaction in the US in over a decade. Jandris and Myers also closed what remains the highest sale price for a single nursing home in the US—a property in the Bronx, NY that traded for $110 million in 2016. More recently, they sold a $182.5-million portfolio of Midwest nursing homes for $180,000 per licensed bed, which is about double the industry average. Working closely with Myers and Jandris is Charles Hilding, vice president of investments. A specialist in the sale of seniors housing and long-term care facilities, Hilding has underwritten more than $5 billion in seniors housing assets since joining the firm in 2011.
Working closely with Myers and Jandris is VP Charles Hilding (left), a specialist in seniors housing and long-term care facilities. On the medical office side, Ryan Gonzales (right), a senior investment associate, is recognized as an expert in his field.
Another key way in which this team has influenced the industry is their training and mentoring of many of the top advisors in this space, including many now-competitors. Perhaps the most significant change they’ve brought to fore, though, is the dismantling of the “good old boy” network among buyers and sellers by introducing new players to the process who compete based on their qualifications and merits of their offers, and not on personal relationships with the seller or broker. Ultimately “the big boys” of this network accepted and even began to respect Myers and Jandris for leveling the playing field because the process is now transparent and based on merit.
On the medical office side, Ryan Gonzales, a senior investment associate, is recognized as an expert in his field of medical office and government services administration investment sales and has made a significant impact in just a few years with the firm.
He long ago recognized important trends shaping the direction of the healthcare real estate market, including mergers among healthcare companies, emerging technologies and the rise in outpatient patient services. He also saw how these dynamics would strengthen optimism for medical office properties among both experienced and new investors. As such, Gonzales garnered extensive transaction experience specific to the unique requirements of healthcare properties and investors and tenaciously developed the GSA sector. The move paid off: Gonzales holds the top spot in the 2018 ranking of the firm’s Healthcare Real Estate Group (HREG) nationwide.
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