Posted December 07, 2005
NexCore creates investment opportunity for physicians in Bend, OR.
To patients, the newly opened Bend Surgery Center in Bend, OR, offers greater convenience – “one-stop shopping” for orthopedic diagnostic, surgical and rehabilitation services.
But to the physicians who now practice there, the two-story, 53,300 square foot (gross) medical office building (MOB) also represents a smart business decision. Developed by Denver-based NexCore Group, the new facility provides more than just much-needed space for expansion. It has also increased the visibility of the orthopedic practice and surgery center, created a synergistic new joint venture, and provided an opportunity for the physicians to enjoy the benefits of real estate ownership.
The process began in 2003. Desert Bone and Joint, P.C., (DB&J), a 7-person orthopedic surgery group, had outgrown its space and been forced to locate staff at multiple leased facilities, explains Ken Moyer, FAAMA, FACMPE, the multi-specialty physician group’s administrator. DB&J decided to construct a new, freestanding facility that would allow it to consolidate services at a single location. In addition, plans called for a building that could accommodate future expansion and an outpatient orthopedic surgery center.
Meanwhile, Bend Surgery Center had outgrown its leased space in a local hospital, says to Sue Nance, RN, CNOR, its administrator. When she learned of DB&J’s plans – including the possibility of a competing surgery center – Ms. Nance says she suggested that the two groups join forces to develop a single facility that could house both organizations. With the help of NexCore Group, a real estate joint venture was formed that includes all of the physicians from DB&J and nine of the 20 from Bend Surgery Center.
“Both groups saw the benefit of controlling their own destiny by owning the real estate,” explains Tim Oliver, NexCore’s senior vice president of healthcare development. Mr. Moyer adds: “It’s a win-win.”
NexCore arranged financing, structured the real estate partnership and served as developer for the turnkey project.
Other developers were considered, Mr. Moyer says, but his group was won over by NexCore’s extensive healthcare real estate experience and contacts. That decision paid off in many ways, he says. For example, NexCore, using its national and local lending contacts, was able to structure a creative and cost-efficient construction and permanent loan package and help the joint venture partners to lock in a lower mortgage interest rate in advance, resulting in considerable cost savings.
Construction began in November 2004 and was completed last month. Physicians, patients, and staff are all extremely pleased with the new facility, both administrators say.
“The building is comfortable, nicely done. I have heard the word ‘classy’ used to describe it,” Ms. Nance says.
“Patients love it. Doctors love it. I would highly recommend NexCore to my associates and friends,” Mr. Moyer adds.