Join the Investor Lifestyle Network

Join the Investor Lifestyle Network

darren nakos

There’s a very powerful and intriguing message that I think about daily: “You are the average of the five people you spend the most time with.”

Who are the 5 people you spend the most time with?

Do they stretch your thinking or inspire you? Are they always seeking to grow personally and professionally? Do they invest in meaningful relationships and endeavors? Do they value travel, outdoor activities, and healthy dialogue?

Those are the kinds of people I enjoy being around.

Life is short, so we make it count.

We have adopted a work hard/play harder mentality in Recentric that allows us to share our life experiences both making money and having fun with like-minded individuals.

tyler fish

Our family recently experienced a fun and amazing trip to Cabo San Lucas Mexico, a place we have learned to love over the years and will eventually be a permanent part of our lives.

We joined several other investors and their families there and were able to go deep sea fishing, ride the dune buggies, and soak in the sun, while leading our businesses remotely.

Join us on our next adventure.

Whether it’s on the ski slopes in Vail, a golf course in Florida, or an excursion abroad, we’d love to explore fun opportunities to connect with other investors who share our mindset: work hard, play harder.

This year, we are also hosting Webinars and  Virtual Happy Hours to stay connected.

Email me and let me know if you’d like to join us on our next adventure.

nakos family

RECENTRIC BUYS VILLAGE PLAZA IN CENTENNIAL FOR $5.5M

RECENTRIC BUYS VILLAGE PLAZA IN CENTENNIAL FOR $5.5M

Centennial, CO. January 9, 2020– Recentric is pleased to announce the purchase of the Village Plaza at 5657 S. Himalaya in Centennial. Built in 2000, this 31,000 SF building has a unique tenant mix of 75% medical and 25% retail.

According to Recentric’s Managing Partner, Darren Nakos, “We believe this property fits in well with our strategy of acquiring, adding value and managing healthcare facilities. We intend to hold the property for several years and work closely with the tenants to ensure a great experience for them and their patients”. Nakos also added that the building will be re-branded to Saddle Rock Medical Center.

Of particular interest with this acquisition is the fact that it was an off-market deal. “We had the unique opportunity to put this purchase together before it hit the market. That meant that we had to move quickly to mobilize our investors and get it closed. Thankfully, we have a solid group of investors that know our track record and were happy to participate”, explained Nakos.

Recentric is a Denver-Based, regional commercial healthcare real estate investment firm. The firm’s strategy is one of value-add and long-term hold for both new acquisitions and development. 



What’s Driving Unprecedented Healthcare Real Estate Investment?

The trend in medical services is moving to outpatient care. As healthcare organizations look to control costs and provide a better patient experience, the concept of delivering critical services under one roof is taking hold. Further increasing demand for outpatient medical facilities is the practice of medical providers expanding services to preventative care and mental health treatment programs. These components, combined with the fact that patients prefer convenience and would prefer not to go to a hospital, has fueled demand for large medical office buildings that are over 150,000 square feet in size. 

According to a report by JLL, there are currently 44 medical office developments larger than 150,000 SF under construction in the U.S. This represents 11m SF and $5.3b worth of investment. With a growing population driving demand for outpatient services, the low supply of these new facilities, and the stability of the healthcare industry, medical office investments continue to show tremendous strength.

These large format buildings are capital intensive and can often be a daunting investment for the healthcare systems, especially considering staffing and equipment requirements. Therefore, investors will have increasing opportunities to participate in these developments as healthcare systems look to outside sources for funding build-to-suit medical office buildings.

Recentric continues to look for development and acquisition opportunities to meet the growing demand for larger, out-patient medical facilities. This strategy allows us to take advantage of the growing need for these facilities, and offer new and exciting opportunities to our current and future investors.

Medical Office Real Estate Investment Looks Strong for 2019

As the U.S. economy slows to a 2% growth rate (2018 growth rate was 3.5%), most sectors are following suit. As consumer retail spending continues to dip, and the overall economic outlook remains uncertain, the ripple will be felt throughout most of the economy. There continues to be a handful of exceptions and health care real estate is among them.

Last month, Colliers International released its annual health care report. The report highlighted the following findings that point to optimism for MOBs (Medical Office Buildings)

  1. Vacancy rates remain low (8.2%) despite 20.9 million square feet of medical office space being delivered in 2018
  2. 2018 lease rates increased by a dramatic 3.6% and are expected to remain strong in 2019
  3. Although investment volume declined slightly in 2018, this was due to a limited amount of MOB investment opportunities

The reports also indicated that health care systems are expanding their reach with off-campus locations, further strengthening demand for strategically located MOBs.

Although the outlook is strong, we believe that our conservative underwriting for MOB investments takes into account economic uncertainty as a whole. According to the Colliers report, cap rates for the western region are hovering around 6.2%. As a hedge against a downturn, Recentric Realty Capital targets cap rates at 8% +, creating a safety barrier for our investors.  These types of deals are difficult to find, but we have a handful of new possibilities that meet this criteria.

Recentric Realty Capital remains very optimistic about the 2019 forecast. With two off campus MOBs, and our aggressive acquisition and development activity, we are poised to take advantage of the opportunity health care real estate provides this year and into the future.

Recentric Welcomes Denver Springs to Parker Building

Parker, CO. March 28, 2019– Recentric Realty Capital is pleased to announce their new tenant, Denver Springs, at 16830 Northgate Drive in Parker, CO. Denver Springs will occupy over 6,000 square feet of office space. According to Recentric Realty Capital’s Managing Partner, Darren Nakos, “We are excited to welcome Denver Springs to our Northgate medical office building. They are a great fit for the location and provide an important service to our community, especially for pediatric behavioral health”. Abby Bartolotta of Health Connect Properties represented the landlord in the transaction; while Scott Visin and Ken Brown with Cushman & Wakefield acted as the brokerage team for the tenant. The clinic is expected to open summer of 2019. 

Denver Springs is a subsidiary of Springstone, a leading provider of high-quality behavioral health services in numerous markets throughout the United States. The new location in Parker will provide convenient, comprehensive child and adolescent outpatient treatment. The clinic will build upon the high quality inpatient and outpatient services provided at Denver Springs and increase access to the full continuum of behavioral healthcare for those who are in need.

Recentric Realty Capital is a Denver-Based, regional commercial real estate firm that focuses on healthcare. The firm’s strategy is one of value-add and long-term hold for both new acquisitions and development.

Is a Micro Hospital a Good Investment?

what is a micro hospital

Health care delivery systems are constantly evolving. These systems are very complex organisms that are influenced by public policy, patient expectations, quality of physicians, societal demands, and payer systems. Health care systems such as hospitals are at the tip of the sword when it comes to meeting the demands of this fickle industry. They must act as a community sensitive force, while evolving and pioneering new concepts to stay materially relevant.

 

Enter the micro-hospital. Ranging in size from 30,000 to 60,000 square feet, the micro-hospital is designed to bring health care services to the patients, where they exist. According to Vic Schmerbeck, executive vice president of strategy and business development at Emerus, the idea is “to deliver a lot of the pre-acute care in a given neighborhood in a place where people work, live and play, and to bring a higher level of service than what you would find with just a retail clinic or urgent care,” Mr. Schmerbeck said.

 

The concept of a micro-hospital is to stay small and versatile. The footprint required is much smaller, which makes them a suitable product in urban and dense suburban settings. The key for hospital systems in getting this choice right is carefully assessing the market fundamentals across the continuum of care so other hospital assets are not replicated. Understanding the demographics and patient needs in a defined geographic area is critical in getting the location and size right as well as delivering the right services to the patients.

 

From an investment perspective, micro-hospitals can also be very stable long term investments. The strength of that investment is largely based on the credit quality of that particular health care system. Moody’s and S&P both cover this industry and can provide a grade to determine the health of the hospital system. For example, Moody’s uses nine symbols as shown below to designate least credit risk to that denoting greatest credit risk: Aaa Aa A Baa Ba B Caa Ca C.

 

As health care changes, hospitals continue to be the pioneers in our constantly evolving society. With the help of technology, and innovation, micro-hospitals can continue to provide pinpointed quality care as well as steady cash flow to real estate investors.