ORLANDO-Harkins Commercial Inc. closed seven medical office transactions in the Orlando area in August. The deals, which included two medical building sales and five medical office leases, are valued at $2.5 million.
"We've been picking up a lot of listings that are adjacent to the hospitals here in Central Florida," Mark Harkins, owner of Harkins Commercial, tells GlobeSt.com. "Landlords are iffy when it comes to who they are selecting to put in their plazas. Medical professionals carry a lot of weight because many medical practices are affluent."
Harkins' latest string of medical office leases includes a 66-month, 4,288-square-foot lease at Equity One’s Lake Mary Village in Lake Mary; a 1,500-square-foot lease at 2605 Lake Mary Blvd. in Lake Mary; a seven-year, 1,450-square-foot lease at RP Realty Partners’ Baldwin Park in Orlando; a 1,500-square-foot lease at 1400 Lexington Green Lane in Sanford; and a 1,402-square-foot lease at 1450 Citrus Medical Court adjacent HealthCentral Hospital in Ocoee.
"Last year it was a lot harder to pull MDs from their current locations," Harkins says. "Most of them were in quicksand waiting to find out what was going to happen with the healthcare bill. Now, that they are seeing what their reimbursements are going to be they are getting a sense of comfort knowing what they can afford, and they are making moves."
Some MDs are making moves toward ownership. In August, Harkins brokered the sale of New Horizons Real Estate Investments' 3,128-square-foot medical office buildings at 10931 and 10945 Dylan Loren Circle in Orlando for $690,000 and $680,000 respectively.
Charles Lentz, managing director of Integra Realty Resources in Orlando, tells GlobeSt.com that Harkins is performing strong in a slow niche market. "We haven't seen that much activity in the medical office arena," he says. "We just finished an assignment for an on-campus medical office building at an area hospital. It's the second or third one we've done in the past year and all of those buildings are struggling occupancy-wise."
Central Florida's medical office market may be readying for a resurrection. Nashville-based Hospital Corporation of America's (HCA) purchased 10 acres, with an option for another 30 acres, in June. HCA purchased the Kissimmee land from Avatar Properties for an undisclosed amount, and plans to use it to build a 60,000-square-foot medical office building and a 60-bed hospital. And West Palm Beach-based Mariner Asset Management Services LLC will soon break ground on a $20 million, 72,000-square-foot medical office complex in Lake Mary known as Heathrow Health City.
For Harkins' part, the firm plans to continue focusing on its winning streak in the medical office market. Harkins is working to close three medical office leases in September and has two large medical building listings on his books. Those listings may not come to market because Harkins already has an interested buyer.
"This is good niche and we are going to continue to market it," Harkins says. "I am hitting all the local medical doctors with constant barrages of the news about our closings so they know we are able to move these properties. If we can brand ourselves as medical office specialists in this economy and it moves properties, we are going to keep doing it."
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