Thomas Park Investments and Artemis Real Estate Partners have formed a joint venture to amass a first-class portfolio of health-care real estate. Together, the partners plan to invest an estimated $500 million on the acquisition of core-plus assets in the medical office building sector.
Thomas Park brings to the partnership proficiency in securing off-market transactions, which will prove valuable in the thriving and highly competitive MOB market. Artemis is a respected investment manager, having raised over $6 billion since its founding in 2009.
The partners have seeded the joint venture with the acquisition of three MOBs totaling 92,000 square feet for an aggregate of $40 million. In Baltimore, Thomas Park and Artemis acquired 910 Frederick Road, a 31,000-square-foot property that is fully leased to Orthopedic Associates of Central Maryland. The partners purchased the asset, developed in 2014, from the tenant in a sale-leaseback transaction. Just 20 miles from Baltimore in Columbia, Md., the joint venture also acquired the 31,000-square-foot MOB at 10840 Little Patuxent Parkway in an off-market transaction. Built in 1974 and renovated in 2019, the property is fully leased, with Johns Hopkins Medical Imaging serving as the anchor tenant.
The joint venture completed its initial portfolio purchases with the addition of 800 Bunn Drive, a 30,000-square-foot MOB in Princeton, N.J. Like the other two properties, 800 Bunn is 100 percent leased. The multi-tenant building first opened its doors in 2010. EJ Rumpke, CEO of Thomas Park Investments described the three acquisitions as a “starting point for building a first-class portfolio along the East Coast.” The joint venture will focus its efforts on markets across the mid-Atlantic and Northeast.
Joining the club
Thomas Park and Artemis’s formation of a new MOB joint venture follows the establishment of a host of other partnerships in 2021 designed to do the exact same thing: capitalize on what appears to be a solid and seemingly recession-proof sector of health-care real estate. The ventures range from Chestnut Funds and Anchor Health Properties’ launch of Chestnut Healthcare Fund II, a $100 million investment vehicle focused on the acquisition of MOBs and other related health-care real estate assets across the U.S. to Rendina Healthcare Real Estate and Artemis’s creation of a MOB joint venture with the goal of growing a $1 billion portfolio.
According to PwC and Urban Land Institute’s Emerging Trends in Real Estate report, only logistical hurdles hampered MOB deal volume during the darkest days of COVID-19 in 2020: “The resilience of the medical office sector through the COVID-19 pandemic and past economic downturns and the long-term favorable demand prospects for health-care services are expected to continue to attract investor attention in 2022 and through the long term.”