Our Health Care Real Estate Briefing is your comprehensive summary of weekly health care real estate highlights happening across the nation.
1. Is housing health care and should Medicaid pay the rent? States are using Medicaid programs to cover rent, security deposits and furniture per The New York Times. AZ is one state that has doubled down on its effort to pay for supportive housing. It has been spending $30M per year to house 2,500 Medicaid recipients that suffer from homelessness and mental health issues The program has saved AZ’s Medicaid agency $5K per month, per person housed by reducing the number of hospital visits by 44%
2. Centene Corporation, a managed care company, plans to spend $1.65B to reduce its real estate footprint at 300 locations (a reduction of its footprint by 65%). Once completed, the reduction should result in savings of $200M per year going forward per Modern Healthcare.
3. An activist investor is attempting to stop the merger between Healthcare Trust of America, Inc. and Healthcare Realty. The investor argues that Welltower Inc.’s $4.8B all-cash bid is 28% higher than HR’s current share price per Bisnow.
4. Hall Render looked at a number of new hospital projects announced in 2022. The following states are leading the way: TX (8); WI (7); AZ (6); and FL (5). Special thanks to Serenity Wang, Undergraduate Intern, for her assistance in gathering this data.
5. Hospitalogy published a detailed article on the pros and cons of Certificate of Need (“CON”) laws, including: 1) CON regulation exists in 35 states; 2) DC, HI and NC have the most stringent CON laws; 3) 24 states altered CON laws during the pandemic; 4) GA and NC may modify their CON laws and WV is reviewing its CON program; and 5) A CON can be worth $1M to $2M.
6. Senior housing facilities continue to struggle financially. State and local governments are stepping up to save facilities on the brink of closure. The MN Department of Health received a court order to take over a skilled nursing facility (“SNF”) in Pine Island per McKnight’s Long-Term Care News and the City of Lexington (NE) agreed to acquire an assisted living facility that announced plans to close per Lexington Clipper-Herald.
7. Hilltop Securities Inc. released its high-yield investor survey. Investors are interested in projects in the following states: TX, CO, CA, UT, FL and AZ. The biggest challenges in 2022 will be addressing senior housing occupancy and staffing, along with rising interest rates, and the biggest opportunities will be in charter schools, higher education and workforce housing.
8. The New York Ear and Eye Infirmary in the NYC may be demolished. The building was used in “The Godfather” when Al Pacino rescued Marlon Brando from a hospital per the New York Post.
9. SilverPoint Senior Living would like to grow by 20 to 30 senior housing facilities over the next decade. Sliverpoint operates AL, IL and memory care facilities in TX and OK per Senior Housing News.
10. Humana has donated a 130K sf office building in Louisville, KY to University of Louisville for its health equity hub per Business Wire.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot give legal advice outside of an attorney-client relationship.
