www.REBusinessOnline.com February 2021 • Volume 18, Issue 6 THE MORTGAGE INDUSTRY REMAINS OPTIMISTIC ABOUT 2021 & BEYOND By Nellie Day Acquired via a joint venture in September 2020, Meridian is currently converting this 110,400-square-foot, four-story building in Orange County, Calif., into a Class-A medical office building. HEALTHCARE REAL ESTATE ROUNDUP By Nellie Day U.S. Property and Portfolio Sales Across Property Types, 2015-2020* 600 550 500 450 400 350 300 250 200 150 100 50 0 2015 2016 2017 2018 2019 2020 573 514 494 582 597 405 T he stability and necessity of medical office space has been a bright spot for commercial investors thanks, in part, to the new emphasis on healthcare caused by COVID-19. Below, three Western-based experts explore the trends that are likely to drive this sector. TELEHEALTH, OUTPATIENT CARE THE TOP HEALTHCARE TRENDS OF 2021 By John Pollock, CEO, Meridian in Walnut Creek, Calif. According to PwC’s fourth-quarter 2020 Investor Survey, the healthcare sector has held up well throughout the pandemic. The survey suggests that most investors will hold their assets because of the macro mar-ket uncertainty and the relative stability that healthcare provides. These dynamics will restrict the supply of transactions. On the development front, most in-progress healthcare projects contin -ued through the pandemic, but the pipeline of new deals has been severely restricted. This may mean 2021 will be a slow year for healthcare across the board. Meridian anticipates that healthcare systems will be slow to make decisions on all types of trans -actions until there is clarity about how and where care will be delivered. Fortunately, the pandemic has had a posi -tive impact on several facets that should improve the healthcare sector by providing greater access to care and helping to reduce the cost. These include: •The adoption of telehealth. The quick ramp up of telehealth has and will continue to provide greater access to care. Centers for Medicare & Medicaid Services (CMS) took early action and removed barriers to allow for the delivery and reimbursement of tele-health visits. The ability to deliver care in rural areas or to patients that have limited mobility is an incredible benefit and it is hard to see those changes being rolled back. • The push to deliver care in off-campus lo -cations. We believe this trend will continue to accelerate. Providing patient-centric care near people’s homes and work will be im -perative to keeping healthy people out of the acute care setting. These outpatient care centers are more convenient for patients and less expensive to operate. Meridian recently see HEALTHCARE, page 46 Y ou don’t have to tell commercial mortgage bankers that 2020 was one for the record books. They were one of the first industries to pull the emergency brake and go into preservation mode when everything erupted last March. Capital markets froze, lenders focused on asset management and origi-nation took a backseat for a little while. “Most lender behavior in the early days of the pandemic was over reactive in nature,” says Andrew Mekjovich, principal in Gantry’s San Francisco office. “As lenders worked to shore up their loan portfolios, the overlay of PPP [paycheck protection program] processing, paired with a targeted approach to new originations, hindered overall loan production early in the pan -demic.” see FINANCE, page 42 INSIDE THIS ISSUE Want to receive this magazine at home? Visit www.francemediainc.com/ publications to temporarily change your address today. Multifamily Remains Favorable For Hawaii Investors page 44 $ (in billions) *includes hotel, industrial, multifamily, office and retail sectors Source: Real Capital Analytics