imed naperville aquisition

MCB SCIENCE + HEALTH ACQUIRES FOUR-STORY, 72,000 SQUARE FOOT outpatient medical building IN NAPERVILLE, ILLINOIS FOR $28 MILLION

Chicago, IL (September 9, 2024) – MCB Science + Health has executed the acquisition of 1331 West 75th Street, a more than 72,000 square foot Outpatient Medical Building in Naperville, Illinois, for $28 million. Known as iMed Naperville Medical Office, the four-story asset was 96 percent leased and occupied at the time of the sale and anchored by Endeavor Health (formerly Edward-Elmhurst Health), which is part of a leading integrated health system in Illinois that serves more than 1.3 million patients across Chicagoland. MCB Science + Health, a division of Baltimore-based MCB Real Estate, acquires and develops projects serving the life sciences, medical office, and senior housing sectors. Jason St. John, Managing Partner, Greenstone Partners, represented the seller, DynaCom Management, Inc., in this transaction.

“The MCB Science + Health team brings deep experience in the medical office building sector, an asset class that is thriving, and iMed Naperville is an institutional-quality project offering every important fundamental necessary to ensure its long-term success,” said Wilkingson (Will) Germain, CEO and Managing Partner, MCB Science + Health. “After carefully vetting this property, it became clear that the building’s tenant base is exceptionally stable and each group plays an important role in satisfying the ongoing health and wellness needs of the greater Naperville community. Equally important is the proximity of the building to major local medical centers, which places these medical practices within easy reach of their patients and related stakeholders.”

iMed Naperville close to main campus of Endeavor Health Edward Hospital

Delivered in 2015, iMed Naperville Medical Office is a Class ‘A’ building equipped with 18,000 square foot floorplates, 10-foot ceiling heights, a two-story lobby atrium, covered patient drop-off and pick-up areas and adjacent surface parking which can accommodate approximately 300 vehicles. Additional tenants include ABC Pediatrics, Basko Dermatology, DuPage Children’s ENT & Allergy, and Naper Grove Vision Care.

Situated in the medical corridor of Chicago’s western suburbs, the asset is less than two miles from Endeavor Health Edward Hospital and is in proximity to four additional regional hospitals, including Rush-Copley-Medical Center, Northwestern Medical Center, Advocate Good Samaritan Hospital, and UChicago Medicine AdventHealth Bolingbrook Hospital. iMed Naperville features roadside visibility from W. 75th Street, is less than five miles from MD Route 59 and is near Westfield Fox Valley Mall and downtown Naperville.

Highly-curated use by medical practice group tenants

Anchor tenant Endeavor Health, which provides access to more than 7,100 physicians and advanced practice providers, has occupied its space since 2015 and gradually increased its footprint within the building. With an “AA” investment grade credit rating by Standard & Poor’s, the health care provider has leveraged its position near Endeavor Health Edward Hospital’s main campus in Naperville to enable the care of its patients at off-site settings. The synergy of the building’s tenants has fostered an ecosystem that generates continuous referrals among its various medical practice groups.

“The pandemic accelerated the trend to move health and wellness services out of traditional hospital settings and into community-based facilities, which helps lower operational costs, places services closer to where patients live, and provides easy accessibility,” Germain said. “This tendency especially targets the older population, where mobility can be limited and transportation options reduced. Health and wellness practice groups typically sign long-term leases that allow them to remain close to their tenant base which is attractive to building owners and investors.”

MOB sector highly stable and considered recession-proof

Germain further adds that the MOB sector is highly stable and considered recession-proof since “patients visit hospital and physicians during every economic condition, which makes the sector extremely resilient.” Because of this, medical offices offer the best long-term risk-adjusted return profile compared with the four major property types, he said.

“Speculative development in this asset class is exceptionally rare,” Germain added, “a scenario which favors well-leased existing MOBs, with its tenants signing long-term leases to maintain their deep relationships with local physician groups, medical centers and patients.”

Enduring strength and quality of life in DuPage County

According to DuPage Economic Development Alliance’s 2024 Q2 Economic Indicators Report, more than 650,000 people are employed in DuPage County, including more than 90,000 in the healthcare and social assistance industries, with an overall unemployment rate of 4 percent. The Chicagoland region is home to nearly 40 communities and one million residents.

DuPage County ranked #1 in a national survey compiled by Niche in its listing of “Best Cities to Raise a Family in America” and placed #4 as “The Best City to Live in America.” In addition, Site Selection magazine named Chicago as the top metro area in the United States for corporate investment.

Summary of MCB Science + Health activities in 2024

This purchase follows the initiation of two MCB life sciences and medical office building developments over the past two years. Earlier this year, the company began construction on Drexeline Medical Office Building, a 60,000 square foot healthcare component of Drexeline Town Center, a mixed-use development situated in the Philadelphia suburb of Drexel Hill, Pennsylvania. The three-story medical office building located at 5100 State Road is 100 percent leased to Delaware County Human Services and Children’s Hospital of Philadelphia (CHOP), a major non-profit hospital group.

Last year, the company delivered the Wellness Center at Yard 56, an 80,000-square-foot, Class ‘A’ medical office building located across the street from Johns Hopkins Bayview. Featuring floorplates of up to 27,600 square feet and amenities for hospital guests, patients, employees, and residents, the asset is leased by Baltimore Medical System, Innovative Physical Therapy, Bay Vanguard Bank, and LabCorp.

MCB Science + Health also revealed plans to develop a life sciences campus within VIVA White Oak, a 280-acre site in the Washington, D.C. submarket which is approved for 12 million square feet of mixed-use development, situated between the U.S. Food and Drug Administration and Adventist White Oak Hospital. The development plan includes up to 4,500 residences, retail, and restaurants and two million square feet of biomedical/biotech labs, offices and research and development facilities.