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MILWAUKEE-Locally based Northwestern Mutual has joined with Charlotte-based Cogdell Spencer Inc. to form a $350 million venture to purchase medical office buildings. Cogdell, a REIT that specializes in medical office properties, will contribute 20% of the equity capital for this project. The venture will use its relationship with Cogdell’s new subsidiary, Marshall Erdman and Associates, a local company that was acquired by Cogdell in March.

Jason Bates, VP of finance for Cogdell, tells GlobeSt.com that the venture’s focus will be on specific property types in markets across the country. “We will target hospital-campus-based, non-profit medical offices, with hospitals that are dominant in their markets,” Bates says. There’s no timetable on the venture’s acquisitions, he says.

His company currently owns more than 50 medical office buildings in 12 states, mostly in the Midwest and East Coast, as well as California. Cogdell most recently purchased the East Jefferson Medical Plaza building in Metairie, LA for $20 million.

The medical office market is very strong, even in today’s environment, Bates says. “Hospitals are continuing to shift to outpatient procedures, allowing health care to be delivered at a lower cost than if it was in a hospital setting. Many health care office deals are aggressively priced, and the market is holding up well, though it is still commercial real estate, and subject to the same factors impacting office and retail today. We like it because it’s a good long-term investment, and that’s been our strategy.”

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