Investment Strategy


Montecito Medical Physician Investment Platform

  • Montecito is creating a fund to invest in medical office buildings (MOBs) nationwide.
  • Expected launch of offering July of 2019.


Utilize Proprietary Database

  • Source off-market deals utilizing our internal, 10-terabyte proprietary database which identifies the largest physician groups across the U.S.
  • Focus on establishing relationships with dominant health care providers who have significant market share.
  • In-house business development group utilizes database to source best-of-the-best medical real estate.
  • Feed data from our proprietary database to brokers across the U.S. to target dominant health care providers in their select markets.



Acquire MOBs from Dominant Health Systems and Large Physician Groups

  • Identify health systems and physician groups who seek to monetize their real estate.
  • Conduct comprehensive due diligence on the real estate, the medical market and tenant financials.



Focus on Secondary and Tertiary Markets

  • Identify markets with compelling demographics in secondary and tertiary markets (below top 50 MSAs in the U.S.) that exhibit strong medical market fundamentals.
  • Montecito’s historical disposition results indicate that secondary and tertiary markets typically achieve higher returns compared to primary markets .
  • Additionally, when aggregated and sold as part of a portfolio, Montecito has typically achieved cap rate compression on these assets.


Flexibility in Arranging Deal Structures

  • We allow physicians to re-invest in the acquisition of their existing medical office building(s), through a 721 Tax Exchange Partnership Program, which defers taxes and creates alignment with the tenant.
  • Prior to closing a deal, Montecito continues to work closely with physicians and health systems to re-negotiate long-term leases with triple net term and annual market rent escalations.
  • The new Physician Real Estate Partnership also allows the younger physicians in the practice to invest into the new entity, which ensures investment alignment between younger physician and those nearing retirement.


Strategically Exit

  • We seek to assemble large portfolios of medical office buildings over a three- to five-year investment period.
  • We seek to exit through portfolio sales to take advantage of the potential enhanced returns that may be generated in portfolio dispositions.
  • Portfolio sales have typically generated higher pricing for Montecito than one-off, smaller transactions.

Montecito has historically achieved a 70bps – 1.5% compression on exit cap rates based on broadly marketing the sale and aggregating into portfolios.


For questions regarding Fund Enrollment contact:

Deanna Farnell


For questions regarding Fund Terms contact:

Bob Neyland

Vice President, Strategy