We have recently updated our medical real estate database covering the southeast U.S. on www.revistamed.com. One market that has a fair share of MOB activity is Atlanta, GA. Yes, investors such as Physician’s Realty Trust, Griffin American Healthcare REIT II and III, MB Real Estate and others have been recently buying in and near Atlanta, but the health systems are drawing particular attention with their respective MOB strategies.
Wellstar Health System of Marietta, GA is a 5 hospital system that has been growing through the establishment of a medical mall model they call ‘health parks’ in Cobb county. These Wellstar Healthparks are medical office buildings that house a variety of outpatient services. The first one open was the Wellstar Acworth Health Park. This is a roughly 75,000 square foot multispecialty building that opened in 2012 and has by all accounts exceeded Wellstar’s volume projections.
On the heels of their success with Acworth, Wellstar now has 3 more health parks in the works. One is due to open in September, 2014 – the Wellstar East Cobb Health Park on Roswell Blvd in Marietta. This building is about twice the size of the Acworth building and will house a surgery center, urgent care, laboratory and other physician services. The system also has plans for the Wellstar Vinings Health Park and the Wellstar Cherokee Health Park in Cherokee county. Below find a table summary of the construction of these health parks.
|Measure||Wellstar East Cobb||Wellstar Vinings||Wellstar Cherokee|
|Size (sq. ft)||162,000||162,000||150,000|
|Est Value (millions)||$73||$68||$63|
|Expected Open||Sept, 2014||2016||2016|
As for Cobb county, there is another system with MOB plans. Northside health system has recently won approval for an 80,000 square foot MOB about 2 miles to the southeast of the Wellstar East Cobb site. By our count, there is roughly 6 million existing square feet of MOB space existing in Cobb county. The Wellstar and Northside projects total about 400,000 square feet which portends a 15% increase in MOB inventory when complete. Cobb county does have demographics on its side – its population is growing at roughly 2x the national average. All in all, this will be an interesting market to monitor over the next 18 months.