Brackett Fl agship

P r o p e r t i e s

Healthcare Real Estate Bulletin

I S S U E

F I R S T

Q U A R T E R

2 0 1 2

D EVELOPMENT I S B ACK !

INSIDE
THIS
ISSUE:

Charlo e, North Carolina

Brackett Flagship Properties has several medical office developments on the boards for
2012!Demand for new space from medical and dental practices is increasingallowingus
tomoveforwardwithnewprojectsinHarrisburgandLenoir,withadditionalbuildtosuit
projectsslatedforlaterthisyearinGastoniaandCharlotte.

Acquisi on of Rex
Healthcare Wellness
Center in Garner, NC

Coltsgate Road por olio

in SouthPark is 100%
Leased!

Is a SaleLeaseback
the Right Choice For
Your Prac ce?

Get to Know Us!

Recent Healthcare
Transac ons

Follow us on:

I V

Harrisburg Medical Park will be located in the Charlotte area at the I485 / Rocky River
Roadinterchange,andisadjacenttothefutureproposedCarolinasHealthcareHarrisburg
Healthplex. The park will consist of three medical office buildings of 15,000 square feet
each.Constructionisscheduledtobegin
inAprilwithaprojecteddeliverydatein
November2012. Several practices have
committed to the project thus far and
thereisalsothepotentialtoleasespace
on a part time, or hoteling basis for
groups/physicianswhowanttoestablish
apresenceinthismarketpriortoopen
ingafulltimeoffice.PetersonAssociates
is the architect on the project and the
Harrisburg Medical Park - Harrisburg, NC
45,000 Square Feet Medical Offices
contractorisConcordeConstruction.
Headingwesttowardsthemountains,wearealsobreakinggroundthisspringonHospital
Avenue Medical Park in Lenoir.ThenewbuildingisthesecondphaseoftheHospitalAve
nueOfficePark,andisadjacenttotheexistingCarolinaOrthopedicfacility.Thebuilding
will have approximately 18,000 square
feet on three levels, and will include a
specialist that will occupy a full floor
(approximately 7,200 SF). The project
is a design build and the contractor is
Brushy Mountain Builders based in
Lenoir,NC.

Hospital Avenue Medical Park - Lenoir, NC

18,000 Square Feet Medical office

This isnt all Stay tuned for more

groundbreakingnewsonothermed
ical office developments planned for
thisyear!

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Brackett Flagship Properties Acquisition Team Completes

Purchase of REX Healthcare-Lease Facility in Garner, NC
Charlo e, NC Flagship Capital Partners (Flagship), the investment aliate of Bracke Flagship Proper es,
is pleased to announce that it has completed its sponsored acquisi on of a 30,000 square foot Wellness
Center in Garner NC.

ThebuildingistheanchorfortheHealthParkatTimberDrive,amedicallycentricsubdivisionofWhiteOak
CrossingwhichisaplannedClassAmixedusedevelopmentoofI40locatedtotheimmediatesouthof
RaleighNC.Thebuildingisleasedtoasingletenant,RexHealthcare,Inc.underalongterm,mul yearlease.

BenjaminE.Bivens,FlagshipsAssociateofSalesandLeasingandBillTransou,FlagshipsChiefInvestment
Ocerrepresentedthebuyergroup,whileStephanieWilsonofACCESSMedicalrepresentedtheseller.

RexHealthcare,amemberofUNCHealthCare,isaprivate,notforprofithealthcaresystemwith4,800co
workers.RexHealthcarehas665bedsandtreatsnearly34,000inpa entseachyear.Rexprovidesavariety
ofhealthcareservicesthroughoutWakeCounty,withfacili esinApex,Cary,Garner,Knightdale,Wakefield,
downtownRaleighandcomingsoontoHollySpringsNC.

Thepurchasecon nuesFlagshipsfocusonthehealthcarerealestate
sector.Weareverypleasedtoacquireabuildingwithoneofthemost
highlyregardedhealthcareprovidersintheRaleighMSAstatedBenjamin
E.Bivens.Welookforwardtodevelopingourrela onshipwithRex
Healthcareandcon nuingourpursuitofqualityhealthcarerealestate
acquisi onsinthismarketareahesaid.

Flagshipiden fied,nego ated,andstructuredtheacquisi ononbehalf

ofitsinvestmentpartners.Bracke FlagshipProper es,themanagement
andleasingcompanyformedbyFlagshipCapitalPartnersandDianeBrack
e Companyin2010,willprovideassetandpropertymanagementser
vicestotheasset.

Our Coltsgate Road Portfolio in SouthPark is 100% LEASED!

2701

Two Class A oce proper es on Coltsgate Road, a por olio totaling approximately 60,000 square
feet,arenowfullyoccupiedduetothehardworkofourleasingteam.Withcon nuedso nessin
thesuburbanocemarket,2901Coltsgatewasonly38% occupiedand2701Colsgatewas83% occu
piedoneyearago.Bothofwhicharenow100%occupied.Asthecommercialrealestatemarketis
slow to rebound during these challenging economic mes, our team and ownership is pleased to
havethesebuildingsfullyoccupied.Themostrecenttransac
2901
onsincludeRE/MAX Execu ve Realty takingtheen refirst
floor of 2901, totaling 9,039 Sq Ft, and New Market Waste
Solu ons taking 4,276 Sq Ft on the first floor of 2701. Vice
PresidentofSalesandLeasing,TianySlayden,reports:

These transac ons on Coltsgate Road are representa ve of the ini a ve and
resourcefulness of our team. When our clients objec ves are fully sa sfied,
Bracke Flagship Proper es is sa sfied.
2701 Coltsgate Road | Suite 300 | Charlotte, NC 28211
O. 704.442.0222 | F. 704.367.0196 | www.Brackettflagship.com

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F I R S T

I N D U S T R Y

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I N S I G H T

Is a Sale Leaseback the right choice for your practice?

Charlo e, NC Manyprac cegroupstodayareinterestedinfindingoutifasaleleasebacktransac onoftheirrealestateistheright
choiceforthem.Theyareaskingques onssuchas;whatisinvolvedintheprocessandwhatdoesatransac onofthatmagnitudelook
like?Inseekingtoprovideabriefoverviewoftheprocess,weveaskedourresidentinvestmentsalesexpert,BenjaminE.Bivenswith
FlagshipCapitalPartners,LLC,tohelpanswerafewkeyques ons.

ues on: Bracke Flagship Proper es What is involved in a

sale leaseback transac on and what are some of the benefits
that are derived from a prac ce group who is considering this type of
transac on?

nswer: Benjamin E. Bivens A sale leaseback, in its simplest

defini on,isarealestatetransac onwhereanowner/occupant
ofthebuildingisnowdesiroustoselltheassetandcreateanewlong
term leaseback with the new purchaser upon close of escrow. The
lease will contain terms and provisions sucient to support a sale to
the purchaser at an agreed value and price that is advantageous to
both par es. The main factor that we hear from prac ces who own
their own real estate is that they no longer wish to carry the liability
and headaches that ownership in real estate entails. Theyd rather
focus on providing quality care to their pa ents, which is of utmost
importanceintodayschanginghealthcareenvironment.Theylikethe
ideaofrelyinguponsomeoneelsetakingonthedaytodaychallenges
ofmanagingtherealestateandbeingresponsiblefordoingso.Thats
amajorbenefittothem.Anotherbenefit,inthecurrentenvironment
of lower cap rates on transac ons, is that the ownership can unlock
equityintherealestateallowingittobeu lizedtowardsotherpress
ingcapitalintensiveneedsoftheircorebusinessprac ce.

How do you go about placing a value on the transac on?

If the asset qualifies under our investment criteria, then we

followasimple,twophaseprocess;a)aninterview,informa on
gathering,andvalua onprocessandb)theproposalprocessinwhich
bothpar esfocusontheneedsandobjec vesoftheprac ce/selling
en tyandtheacquiringparty.First,wewanttomakecertainthatwe
understandthecompleteobjec vesoftheprac ce,asaresultofsell
ingtheirrealestateasset,makingsurethisistheappropriatedirec on
for their considera on. The process includes the conduc ng of the
interview,askingques onsanddeterminingthecri calobjec vesthat
theprac cewouldliketoaccomplishwithasaleleaseback.Ourjobis
to make sure that they understand both the posi ve and poten ally
nega veaspectsofthesaleleasebacktransac on.Whyitmakessense
toleaseversesownrealestate,orviceversa.Dotheyhavespecifictax
implica ons (both personal and business en ty) that need to be
considered?Dotheywishtoreinvestalloranypor onofthederived
equity recapture? Are they acquiring, or considering acquiring, other
poten al prac ces containing real estate assets to which a 1031

AS

exchangecouldbeu lized?Second,welookforbasicinforma onregarding

the property itself and how its currently being operated. A er the first
phase is complete, we combine all of the informa on into our internal
underwri ng process, resul ng in a presenta on proposal outlining the
termsandcondi onsunderwhichFlagshipwouldbewillingtopurchasethe
building. At this point, any decision to proceed is le completely to the
prac ce. For example, part of our underwri ng and proposal takes into
considera onthesellersdesiredpricepointwhichwillthenallowFlagship
to derive a lease rate and other economic terms favorable for the lease
agreement.

Can any of the previous owners reinvest back into the new
structure?

Yes, they typically can. Some mes we see that a group of doctors
collec velyownthebuildinginseparateLLCs.Somewishtocashout
andendtheirownershipcycle,whileothersmaywanttocon nueundera
newownershipstructure.Thesedecisionsvarybasedupontheindividual,
butwiththeflexibilityofourfirm,undermostcircumstances,weareableto
oer any previous owner the opportunity to reinvest into the new struc
ture.Anotherfactoristhatourfirmhasthecapabilitytohandleallaspects
ofrealestatewhenitcomestoacquiring,owningandmanaginghealthcare
realestate,elimina ngsuchconcernstotheinvestorgroup.

Why is Flagship Capital Partners, LLC the best choice in the market to
handle this type of transac on?

Healthcarerealestateownershavecometotrustourfirmsabilityand
reputa ontoclose.Wehaveextensiveconnec onsintherealestate
industry that can be u lized to maximize value in any transac on. Since
Flagship is a private firm, we are very flexible in our investment ini a ves
andweareabletostructurewin/winscenariosforprac ceslookingtocon
duct a sale leaseback transac on. And lastly, were a fun group to work
with! Our team is very personable, professional, honest and straigh or
ward.Wevalueourrela onshipsandalwayslooktobuilduponthemlong
term.

Benjamin E. Bivens works exclusively with Flagship Capital Partners, LLC as

an acquisi ons representa ve and is a licensed real estate agent in the
states of NC, SC and TN. He focuses on working with ownership groups who
desire to unlock the equity in their medical oce real estate. Benjamin can
be contacted at 7049714881 or [email protected].

L
.
2701 Coltsgate Road | Suite 300 | Charlotte, NC 28211
O. 704.442.0222 | F. 704.367.0196 | www.Brackettflagship.com

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F I R S T

Get to know Us!

W. Charles Campbell
Managing Partner
Charles has over 20 years in the commercial and investment real estate business with extensive experience in deal structuring, financing, development, asset
management and corporate real estate services. He is
the co-founder of Flagship Capital Partners which partnered with the Diane Brackett Company in 2010 to
form Brackett Flagship Properties. Under his leadership, Flagship Capital has completed $500 MM in total
transaction volume over the last five years, with the
majority of that business concentrated in healthcare real estate. He is a Wake
Forest graduate who lives in Charlotte with his wife, Julie and two children. In
his spare time he enjoys his childrens activities and playing tennis on the side.

Diane Brackett Rivers

Managing Partner
Diane Rivers is a Wake Forest graduate who founded
Brackett Company in 1985 where she created a portfolio of quality commercial and medical office buildings
and then merged with Flagship Capital Partners in 2010.
She has overseen the development of more than thirty
projects, totaling 1.5 million square feet and valued at
over $200 million. Diane is poised to launch two to
three development projects this year. Since the economy hit the downturn in 2008 and very little development has taken place, she quips I hope I havent forgotten how to do it!

J. Brannen Edge, III

Chief Operating Officer
Brannen is a Richmond native and serves as Brackett
Flagship Properties Chief Operating Officer. In this role
he helps oversee the financial health of the company
and is responsible for asset management, investor communications, strategic relationships and identifying and
analyzing acquisition opportunities. Prior to joining BFP,
Brannen was a Vice President in the Commercial Banking Group with BB&T. A James Madison University
alumnus, Brannen earned his M.B.A. from UNC-Chapel
Hill with dual concentrations in Finance and Real Estate. Brannen, his wife Melinda
and their son are enjoying the addition of a new baby girl to their family.

Kristy M. Venning

Q U A R T E R

2 0 1 2

Fourth Quarter Transactions:

Remax Executive Realty is relocating its SouthPark
offices to 2901 Coltsgate Road in April 2012. The firm
will occupy 9,000 sq. ft. on the first floor of the building. Tiffany Slayden of Brackett Flagship represented the
Landlord, T. Hall Enterprises I, in the transaction.
Dr. S. Lee Guice, III, MD, a specialist in adult and pediatric urology, renewed his lease at 1918 Randolph Road
in Mid-town Charlotte. Tiffany Slayden of Brackett Flagship represented Dr. Guice in lease renewal negotiations. Caldwell Rose with NAI Southern Real Estate represented the building owner, Meadows & Ohly, LLC
Carolina Asthma & Allergy recently renewed its lease
at 900 Branchview Drive in Concord, North Carolina. Tiffany Slayden with Brackett Flagship represented
Carolina Asthma & Allergy in its renewal negotiations.
Novant Medical Group recently leased 2,312 sq. ft. at
10320 Mallard Creek Road in the University area. Tiffany
Slayden represented the Landlord, Cogdell Investors
(Mallard) and Mike Wiles of NAI Southern Real Estate
represented the tenant.
Dr. Ray Peleaux, DDS MD, an Oral Surgeon, recently
leased 3,000 sq. ft. at 3541 Randolph Road, in Mid-town
Charlotte. Tiffany Slayden represented Dr. Peleaux and
Jennifer Brotherton with Cogdell Spencer represented
the Landlord.
Carolina Digestive Health Associates renewed is
Matthews office lease at 1450 Matthews Township Parkway. Reed Griffith of BFP represented the practice and
NAI Southern RE represented the Landlord.
Dermatologic Surgery of the Carolinas signed a
lease for 3,538 SF at the Ballantyne Medical II building
located in the Ballantyne Corporate Park. Reed Griffith
represented the tenant and The Bissell Companies represented the Landlord.
CPG Search Partners recently opened for business at
Toringdon Medical Plaza II, located at 12105 Copper
Way. The tenant was represented by Joe Cherry of
Cherry & Associates and Reed represented the Landlord.

Leasing & Brokerage Assistant

Kristy serves Brackett Flagships leasing and sales team
in a variety of capacities as well as handles the marketing operations of the company. After graduating from
Virginia Tech she worked in the multifamily and retail
real estate sectors. She joined BFP in 2011 and explains,
Im privileged for the opportunity to learn the complexity of Healthcare Real Estate from the best in the
business. Aside from tenant prospecting for space, of
course, she enjoys being on the water, Starbucks, and
spending time with family. Kristy is a licensed NC & SC Real Estate Broker.

For Leasing or Sales Information,

Please Contact:
Reed Griffith
704.971.8908 | [email protected]

Tiffany Slayden
704.971.8906 | [email protected]

2701 Coltsgate Road | Suite 300 | Charlotte, NC 28211

O. 704.442.0222 | F. 704.367.0196 | www.Brackettflagship.com