Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
We just opened escrow on a parcel of land on which we will be building a new 11,000 sq. ft. medical office building in Fullerton, CA. It's 3/10 of a mile from St. Judes Hospital, and the ONLY available parcel on which to build! It's a spec building, new construction, etc., meaning beating the bushes for a hard money lender... though we're already getting interest by potential buyers, so, hopefully it will all come together. Our son (and one of our partners) has started desiging the building, and it's going to look great! Modern and timeless. Once he has a rendering for me I'll share it with you.
I will be posting a blog on Medical Office Buildings as investments, and the journey developing it soon for those of you interested!
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
13y
Kelly N. Geoffrey Murphy Thanks! I know most people on BP are residential investors, however; many are reaching their limits on the number of houses they can finance etc., so thought this might get them thinking about investing in fewer, but larger projects over several houses.
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
13y
Glenn Espinosa Thanks! I know you're a busy man yourself. In fact, I just posted a thread you might find interesting and give you something to think on.. it's title is GO BIG OR GO HOME!
You're doing great Glenn, keep it up, you ae an inspiration to many on here!
Philly Area, PA · Member since 2008 · 297 posts · 27 votes
13y
Sounds awesome Karen! I think you hit the nail on the head with regards on financing SFH limits. You can do one big commercial deal, like yourself, and be set for the next few years.
One question for you Karen, when did you decide to make the move from residential to commercial deals, I.e. the move to more complicated deals. Thanks rocco
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
13y
Karen, first, good luck! Wow, your son is designing the building, you have a son old enough to be an architect?
Been there with existing building, a long story but we were basically told by three local architects to get with a firm in KC Mo. Too specialized, oxygen, electrical, plumbing, lead covered walls behind sheetrock, anti-static floor, air filtration, the list goes on. My involvement was not hands on, investors/management, but the CG was pulling his hair out with compliance issues.
I'm probably the only guy that has medical grade electrical outlets in a cabin and storage building, left overs. The electrical inspector did a double take and asked where in the world did you get medical grade outlets? (They have a green dot on the face of them).
Can't imagine doing it as a spec, unless you're not doing any infill. I can see a free span metal job. Without the type of facility needed for the tenant seems you'd be guessing, I learned alot from the Docs as to thier work flow-floor plan requirements, private entries, seperate service entrances, secured storages...etc.
Rehabber · Alexandria, VA · Member since 2011 · 446 posts · 171 votes
13y
Karen Margrave Thanks a lot for the kind words. And, you're right - I am pretty busy nowadays. I don't know how some of you guys are doing it but there aren't enough hours in the day!
I'll be sure to take a look at the thread you mentioned.
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
13y
Bill Gulley It sounds like what you did was some type of surgical or hospital type building? Aside from that, trying to retrofit an existing building would be a nightmare, that's what's so great about new construction. For us, we will immediately put the building up for sale, and hopefully have the end user in a short amount of time, allowing all the specialized items and equipment to be planned. We have built medical office space before, along with medical/dental clinic, etc.
My son isn't an architect, he designs the building, does all the site layout, etc., then we take it to an architect to look over and make any tweaks if necessary for permits, and a structural engineer does his stuff, saves alot of money that way, and best part is allows changes to be made immediately saving time.
As to my age.. I'm a baby boomer,you know that! It taken me years to cultivate all these tidbits I share!!
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
13y
Roc P. We've basically always done commercial construction. In the area where we lived, we knew the market very well having basically grown up there, so knowing the needs of the area made it easy.
After the market crashed we relocated and are starting in a new area. as the area we lived in was highly dependent on construction and unemployment there was 20%. We've spent the last few years researching the areas of Orange County that are easiest to build in (as far as permits, etc.), researched the various markets in those areas, and feel comfortable with what we've found out. Since the area is new, we want to stick with what types of buildings we are comfortable with, and there's a market for. Low rise medical office buildings, and new home construction are two of those.
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
13y
Ah yes, good plan then. Yes, there was an OP surgical issue, but here, even a doctor's office will have medical issues, the dentist needed lead wall linings as well.
But, sounds like you have a great niche there, good luck!
Investor, Rehabber, Broker · Orlando, FL · Member since 2012 · 51 posts · 7 votes
13y
Hi Karen,
Just came across this post. I specialize in medical office in Central Florida. I've been a broker since 2004 and just started investing medical/dental office over the past year and now making the leap to full-time investing/rehabbing/flipping these properties. Prior to brokerage I worked as a Project Engineer for a large hospital builder and later as a Construction Manager for Mayo Clinic. I had a GC license at one time but I don't think I'm cut out to be a contractor and would much rather work with one that I feel comfortable with and instead just focus on investment. I look forward to sharing experiences and ideas with you on medical office.
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
13y
We are still working on the financing on the project. As you can imagine, money for a spec medical office building, with the uncertainties of Obamacare are challenging. However; the location is great, and the fact it's going to be offered for sale as condos is a huge plus. There's no other office space, large or small available for sale. We're thinking it will be great for those wanting to own their own space, or investors that would like to buy a smaller unit or the building to lease and hold. Most of the really large buildings are owned by a few big investors, and are older.
I'll keep you posted on how things go. I think we're getting close to tying down the construction loan. Fingers crossed!
Denver, CO · Member since 2012 · 218 posts · 48 votes
13y
We currently have one of our properties on the market that we are selling to medical applications as it is surrounded by the urban hospital campus, and the new hospital surrounding it is almost complete. So it was time to let this one go.
Sounds like a far different application than yours, but this is my first time dealing with a medical application and the concerns that come up with this in mind.
This was a historic renovation that will need to be renovated again for medical application, but we also have both adjacent parking lots, that will allow another 30k sq ft of new construction if desired. The current building is about 18,000 leasable ft. Also this building is LEED gold, currently leased to an architecture firm. A few pictures below.
Pittsburgh, PA · Member since 2013 · 82 posts · 17 votes
13y
@Karen Margrave that's awesome you have such talent, skill and knowledge to keep it all in the family. Are you still seeking funds for your project? I deal in Private/Hard money funding. If you like I can review your executive summary/business plan and submit to my lenders to see what we can do for you. We have programs available for the medical profession. Let me know. I'd love the opportunity to work with you!
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
13y
@Andrew Hofing We are working with a lender right now, trying to put the pieces together. It's someone that came about through a couple of BP members, etc. If it doesn't work out, I will be sure to get in touch with you.
For commercial, new construction loan, what are the LTVs, points, interest, etc. that you typically see? You can pm me if you'd like. Also, any Joint Venture prospects? We will be doing other deals. Thanks for your reply.
Investor · Tyler, TX · Member since 2013 · 7 posts · 3 votes
12y
@Karen Margrave Hows the project going? Sounds like a wonderful opportunity! I've been working in health care real estate for years and if you need any help please feel free to let me know
Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
12y
@Tripp Hornischer I had posted that quite some time ago. With all the hoopla over Obamacare, we backed off that project, waiting until the dust settles. However; we have started getting more interest lately, so we may move forward with it.
Investor · Bellingham, WA · Member since 2013 · 210 posts · 138 votes
11y
I will tell you, from the medical side, there will be little chance that any independent docs will be looking for a large new building. Just too expensive, & income is flat (or declining) for docs (unlike the hospitals, government bureaucrats, and insurance). Private practice is dead unless you give up insurance and do concierge practice, which would be unlikely to fly so close to a competing hospital (they'll intentionally put the competing docs out of business). There ARE docs out there who are looking for SMALL spaces to open micro practices (300-100sqft single/double room office space) and that is probably going to be a new little niche market (I'm in it myself).
Now, all that being said, corporate hospitals are busy gobbling up the remaining private practices and still need office space to put those outpatient offices in. If the plot is that close to the hospital, you may want to just approach and try to sell it to them directly, with your office building plans in hand...