Healthcare Provider Post-COVID-19 Strategies

Q2 2020 Healthcare Capital Markets Report

   M&A Activity Expected to Surge as Independent
   Health Systems Look for Partners

A recent report estimated approximately 27% of health systems had used over 50% of their reserves by mid-June. While this was largely driven by the decrease in elective procedures amid the COVID-19 pandemic, one likely effect will be a surge in merger and acquisition activity. The second quarter 2020 M&A transaction volume fell to a 5-year low as health systems focused on managing financial and operational challenges caused by the pandemic. The increase in activity as we move into 2021 will be led by independent health systems seeking to secure partnerships as part of their post-COVID-19 recovery plans.

   July 2020 M&A Spotlight: Wyoming Medical Center
Commentary by: Eric Murphy, Managing Director, Global Healthcare Services

On July 14, 2020, Banner Health acquired Wyoming Medical Center for $157 million. The medical center, located in Casper, WY, specializes in radiology, intensive care, pediatrics and neuro care.

   Five No-Regret Strategies Health Systems are
   Employing for Sustainable Results
   $472M+ in MOB Transactions Closed in July 2020

Forty-eight medical office building transactions closed in July, totaling over $472 million and 1.790 million square feet. California had the most medical office building transactions with 9 (18.8% of total), followed by Georgia and Florida with 4 each (8.3% of total). The average deal size was $11 million. The largest transaction was the acquisition of the 219,000-square-foot Mercy Wellness Center by Mercy in Oklahoma for $106.5 million.

Todd Perman, CCIM
Vice Chairman
Global Healthcare Services

Global Healthcare Services
Newmark Knight Frank
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