JLL Snags Healthcare Project-Management Firm

SAN CLEMENTE, CA—JLL is acquiring locally based CLEO Construction Management, a construction project-management services firm that specializes in medical facilities. The acquisition will allow JLL to provide a broader range of services to healthcare organizations and meet the growing needs of this real estate sector.

CLEO is a leader in serving owners' representatives to provide fully integrated solutions—including coordination, planning and construction project management—for complex healthcare projects.

The transaction, set to close later this month, subject to customary closing conditions, comes at a time when owners of healthcare facilities are increasingly pursuing expansions and renovations in order to meet the growth demands of their patient bases.

According to Peter Belisle, market director for JLL's southwest region, CLEO is “a powerful fit with JLL due to its deep expertise in construction project management for medical facilities, its commitment to integrity and innovation and its strong relationships with healthcare organizations.”

CLEO was founded by principals Jeff and Tim Fyffe. “Many of the health systems we serve are seeking more-comprehensive outsourcing services from their real estate partners. Joining JLL allows our team to expand our established services, which we built based on high standards and individualized solutions, as part of a global company.”

In all, 13 CLEO staff members will become a part of JLL, with Jeff and Tim Fyffe joining JLL as SVPs. They will report to Carlos Serra, managing director for the Southwest project and development services group, which manages design, construction and relocation services for a wide range of projects form interior build-outs to multi-site development. The PDS group manages more than 12,000 projects annually, including $12 billion projects currently under management.

The group will partner with JLL's healthcare solutions group, which delivers patient ambulatory facility management, strategic consulting, real estate capital advisory, program management, property management, transaction services, lease administration and energy/sustainability advisory services to hospitals and healthcare systems throughout the nation. On the West Coast, JLL's healthcare business, which is led by managing director Jason Clark, has been expanding its services platform and recently hired veteran healthcare brokers Paul Braun and Chris Rose to provide healthcare leasing, investment sales and occupier services in San Diego.

According to Clark, “Hospitals seek to reduce costs and risk in their operations and capital projects while, at the same time, increase performance and quality. This is particularly true in California, where growing activity in the healthcare sector requires the best talent, like our colleagues form CLEO, who can help manage the ebbs and flows of both routine and strategic capital projects with a deep understanding of the unique regulatory requirements in the state.”

The healthcare sector is becoming more creative about the space it is using for expansion and renovation. As GlobeSt.com reported in January, consolidation is the keyword for medical practices today as they search for operating efficiencies. Since healthcare is moving away from the hospital setting into more of a retail environment, this consolidation presents challenges for larger medical practices seeking space to accommodate their needs. One solution has been for larger groups to lease retail space that formerly held sizable stores such as Barnes & Noble, Sonya Dopp-Grech, SVP/director of healthcare services for NAI Capital in Irvine, CA, told GlobeSt.com.

Stay tuned to GlobeSt.com for an in-depth Q&A with JLL's Peter Belisle on this acquisition and healthcare construction trends in the western region of the US.