Louisville Real Estate News

Faulkner Real Estate Launches New Healthcare Unit
April 21, 2006
By Paul Rosta, Senior Associate Editor

In a bid to leverage its local experience in the medical office building market, Louisville-based Faulkner Real Estate on May 1 plans to roll out a new subsidiary intended to create a national platform.

“We want to become the corporate real estate department for large hospital systems,” Steven Higdon, Faulkner Real Estate partner & executive vice president of commercial leasing, sales and marketing, told CPN this afternoon. The new unit, Faulkner Healthcare Real Estate, will respond to the last decade’s trend that has seen many hospital systems selling assets in order to invest the proceeds in new technology and other core areas.

“(Hospitals) realize they no longer have to own the real estate to control their destiny,” Higdon said.

Although many for-profit hospitals have already sold their medical office buildings, not-for-profit healthcare systems often have not and offer the largest opportunity, he added. Medical office buildings make up some 60 percent of Faulkner’s 2 million-square-foot portfolio, which also includes Class A office and retail properties. Projects in the pipeline are expected to double the value of its $115 million medical portfolio.

Faulkner Healthcare will aim to replicate the company’s longstanding relationship with Norton Healthcare, a major Louisville medical system. Faulkner leases or manages approximately 750,000 square feet of medical office buildings for Norton. About half the portfolio was acquired from Norton, and Faulkner developed the other half. Specifically, Faulkner is targeting on-campus medical office buildings in major metropolitan areas.

To foster relationships around the country, Faulkner is bringing on board Norton Healthcare executive David Laird as head of the new unit. “We’ve got the experience. What we don’t have, outside of this market, are the relationships,” Higdon said.