A healthy niche: as Baby Boomers age, Bremner & Wiley stakes out health-care real estate. (Real Estate & Construction).
The Indianapolis real-estate development and management company focuses on health-care facilities. It's a segment of real estate that has expanded nicely during the economic downturn and promises to explode as Baby Boomers approach the age when their health-care needs will multiply.
"The Baby Boom generation, which I'm a part of, started turning 50 years old in 1996," says Jim Bremner, CEO of Bremner & Wiley. The number of people age 65 or older is at least 35 million now and will double by 2030, he says. Meanwhile, the percentage of America's gross domestic product that goes toward health care is likely to grow from about 15 percent now to more than 20 percent in a decade or so, according to Bremner.
All of that growth is visible on the horizon, yet health-care facilities already are being strained. "As recently as last summer, for three days in Indianapolis all hospitals were on diversion," meaning all beds were full and alternative solutions had to be implemented to find space for patients. "You have this current phenomenon of inpatient growth, and over the last 10 years you had a tremendous surge in outpatient growth."
Clearly, there's a huge need for medical facilities, and Bremner's firm is ready to assist. The company specializes in development and management of such properties as medical office buildings, buildings housing such services as labs and imaging, surgery centers and specialty hospitals.
One of its highest-profile projects of late is The Heart Center of Indiana, a $60 million Carmel facility jointly owned by cardiologists and St. Vincent Health that opened in December. Also completed last year was a 132,000-square-foot medical office building on the St. Francis Indianapolis hospital campus. Bremner & Wiley has worked with Clarian Health on a number of facilities built as part of its "beltway strategy" for serving suburban Indianapolis. The firm has worked with OrthoIndy, Witham Memorial Hospital in Lebanon, Fayette Memorial Hospital in Connersville, Hancock Memorial Hospital in Greenfield and numerous other health-care organizations across Indiana and in several other states from New York to Florida to Minnesota.
Why do doctors and hospitals hire a company like Bremner & Wiley? Because health-care providers increasingly want to focus their attention on helping people, not building and maintaining buildings.
"They turn to third-party developers with a high degree of health-care competency like ourselves," Bremner says. That's because health-care facilities are not your average buildings. They've got technological and regulatory requirements not found in other industries. There are financial and capital-planning twists unique to health care. Even such building maintenance tasks as cleaning, heating and cooling are done differently in health care, with demanding sterilization and filtration needs. While hospitals may want to unload some of their facility responsibilities, only a company with a strong knowledge of health care is likely to be up to the task.
In addition to outsourcing building and management tasks, it's becoming increasingly attractive for hospitals to leave building ownership itself to someone else. The concept fits well with the current development trend pairing not-for-profit hospitals with for-profit physician groups as partners in new specialty facilities, such as The Heart Center of Indiana. Though Bremner & Wiley sold several buildings to California-based real-estate investment trust Health Care Property Investors Inc. in the late 1990s, it maintains ownership in most of the buildings it has developed.
Today the firm's management portfolio includes some 3 million square feet of medical facilities. "Our goal is to try to develop six to eight new projects per year," Bremner says.
Bremner, who founded the firm in 1986 and has been involved in real estate for more than two decades, finds the health-care segment of real estate especially gratifying. "We're in an industry where we feel we can help people," he says. "We can make a difference."