Paoli Medical Plaza sells for almost $25M

Sale reflects strong demand for medical office buildings, the deal’s broker says

A medical office building complex located next to the Paoli Hospital property recently sold for nearly $25million.

A medical office building complex located next to the Paoli Hospital property recently sold for nearly $25 million.

Paoli Medical Plaza, a 99,059-square-foot complex that houses various medical offices, changed hands in April in a deal brokered by CBRE Inc., the commercial real estate firm announced.

Paoli Medical Center is comprised of three buildings on 9.7 acres and is anchored by Main Line Health, which also owns and operates neighboring Paoli Hospital. Main Line Health occupies 37 percent of the buildings for clinical, billing, and administrative uses, CBRE said in announcing the sale for $24.82 million.

The campus includes several other prominent healthcare tenants, including Paoli Hematology/Oncology, Philadelphia Hand Center, Premier Orthopedics, Aligned Medical Group, Urology Health Specialists, Women’s Health Care Group of PA and LabCorp.

The seller, Paoli Office Park Partners L.P., is a partnership affiliated with Blank Aschkenasy Properties of West Conshohocken, said Steve Marzullo, senior vice president with CBRE.

The campus was purchased by Griffin-American Healthcare REIT III Inc. through American Healthcare Investors LLC of Irvine, Calif.

“The sale was pretty straightforward, it went from one private investor to another” Marzullo said. “Nothing’s changing” for tenants or the patients who use the offices, Marzullo said.

Blank Aschkenasy Properties is in the process of transitioning its portfolio from office space to apartment complexes, Marzullo added.

“This was an opportunity for them to sell” while American Healthcare Investors is interested in expanding into the Philadelphia market. The company bought a 73,000-squarefoot office building in Gulph Mills in January for $18.5 million, the CBRE senior vice president noted.

The market value of the Paoli property was increased by another factor.

“It is strategically located next to Paoli Hospital, and there is a great synergy between the tenants of the campus and the hospital,” noted Justin Marlowe, senior associate with CBRE’s Capital Markets Group in Wayne.

While the overall office market is only slowly improving from a recent downturn, the market for medical office space is extremely strong, according to Marzullo.

With an aging population, the medical office market should continue to thrive, especially in affluent areas like Paoli where residents are likely to have health insurance, Marzullo said.

“This sale is more indicative of how attractive medical office space is these days,” he said. “If we get our hands on a medical office building, it’s going to sell.”

To contact staff writer Brian McCullough, call 610-2352655 or send an email to bmccullough@dailylocal.com.

COURTESY PHOTO The Paoli Medical Center, which is comprised of three buildings on 9.7 acres next to Paoli Hospital, recently sold for $24.8 million.