Press Release – Cincinnati Business Journal – Ensemble Health Partner’s HQ purchased in the middle of Covid-19 pandemic

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A joint venture between a London-based real estate investment firm and a Kuwait-based investment company has purchased Ensemble Health Partner’s new Blue Ash headquarters.

Blue Ash Funding Co. LLC, a joint venture between 90 North Real Estate Partners and Rasameel
Investment Co. purchased the 400,000-square-foot campus at 11511 Reed Hartman Highway from Mercy Health last month for an undisclosed amount. The massive commercial real estate purchase also happened in the middle of the coronavirus pandemic.

Dan Cooper, partner and head of North America for 90 North, said the buyers had to overcome all sorts of complications to close on the purchase. They had a contract to purchase the property just prior to Ohio and other states instituting stay at home orders. The buyers’ due diligence took place during those stay at home orders. The closing had to be extended a couple of times as the parties worked through different issues.

Then there was a holiday in Kuwait in February and some of the investors were out of the country. When the Covid-19 pandemic hit, those investors couldn’t make it back into the U.S. And everyone, from lenders and lawyers to the seller and title company, had additional work to get the transaction across the finish line.

“The key to this was relationships, relationships, relationships,” Cooper told me. “Everybody was trying to work through and help everyone.”

Closings for large real estate transactions are normally complicated, but adding in the pandemic made it three times more difficult, Cooper said. The sale is a good sign for commercial real estate activity in Greater Cincinnati, as this is one of the largest office properties to transfer this year and the only to be sold after the Covid-19 pandemic started.

In a statement, Ensemble, a fast-growing revenue cycle firm, said it looks forward to partnering with 90 North “to continue to offer our associates a place to work that fosters collaboration, teamwork and a sense of community in a space where we can truly redefine the possible in healthcare by empowering people to be the difference.”

Mercy Health is redeveloping the western portion of Procter & Gamble Co.’s former Sharon Woods
Innovation Center into Ensemble’s headquarters. Ensemble has a 15-year lease for the campus and its first employees moved into a portion of the building in February. Eventually, the property is expected to be home to about 2,600 employees in an open, collaborative office designed to promote employee health and happiness.

Cooper said Mercy Health’s real estate team, Danis Construction and Cushman & Wakefield, which is the project manager, are all first class. “When you’re buying an asset that’s under construction, you want to make sure that from the bottom up, the construction company, the subcontractors, the project managers are all on top of it,” Cooper said.

A little more than a year ago, Bon Secours Mercy Health announced Golden Gate Capital of San
Francisco would acquire 51% of the equity in Ensemble. Bon Secours Mercy Health retained minority ownership and representation on the board of Ensemble.

Dan McCarthy, vice president of real estate development at Mercy Health, said as they were evaluating their real estate portfolio, Bon Secours Mercy Health determined the Ensemble campus was not part of its core portfolio. They engaged Cushman & Wakefield to sell the property. Mike Sullivan of the Capital Markets team with Cushman & Wakefield represented Mercy Health in the sale.

McCarthy said Mercy Health’s experience with 90 North as its landlord resulted in a lot of trust and fed into the decision to select the 90 North joint venture as the buyer. “It’s not easy to close on a large transaction like this during a pandemic,” McCarthy told me. “The ability of this buyer to go under contract prior to Covid-19 hitting and then actually follow through, do due diligence through a pandemic and close is just truly impressive.”

For 90 North, this marks the firm’s fourth property in Greater Cincinnati. It also owns the office building at the Banks leased to General Electric for more than $107 million, Mercy Health’s headquarters in Bond Hill for nearly $86 million and it acquired the Offices at Vernon Manor and the Offices @ Vernon Place for more than $75 million. Cooper said 90 North typically targets acquisitions between $50 million and $500 million.

90 North is actively looking for additional acquisition opportunities in Ohio. “There’s good activity going on,” Cooper said. He said there could potentially be increased demand for investment grade office properties with Fortune 500 or government credit tenants with long-term leases. “There is still a lot of money out there seeking returns,” Cooper said.