CHALLENGE

Urology of Virginia is a dominant, regional urology practice with a longstanding community presence in the Virginia Beach, VA area. Global Healthcare Services had previously performed a valuation analysis for the practice and were engaged again when the practice was approached with a one-off offer from an institutional healthcare investor group. GHS was asked to help sellers achieve improved pricing and occupancy costs relative to the offer in hand.

ACTION

GHS consulted with the CEO and lead administrator on a plan to lower occupancy costs, while still maintaining a price point that was as good as or better than the current offer. Urology of Virginia opted for GHS to run a strategic process to create competition for the properties. GHS conducted three rounds of bidding and helped guide buyers to the appropriate rental and property management structure.

RESULT

After GHS concluded the 3 rounds of bidding, Urology of Virginia chose to partner with an investor group that offered $3M over the initial offer. With this offer, the practice was able to achieve their original goal of improving the price paid for the property, while simultaneously reducing the costs to their practice compared to the original offer. The portfolio traded at below a 6% cap rate for a non-rated private practice and GHS continues to advise Urology of Virginia regarding potential M&A activity.