NNN Investment - United Healthcare Urgent Care & Pharmacy

CBRE’s Net Lease Property Group, as exclusive advisor to Ownership, is pleased to present the unique opportunity to acquire a Primary Care Plus and Houma Urgent Care Pharmacy (the “Property”), located at 123 & 131 Corporate Drive in Houma, Louisiana. Owned by UnitedHealth Group (NYSE: UNH), Primary Care Plus is currently operating under a 7-year corporate lease, which runs through January 2030, while the Houma Pharmacy is being offered as a 10-year sale leaseback. Together, the tenants have a weighted average lease term of 6.1 years.

The two buildings total 10,119 SF, with Houma Pharmacy occupying an 1,848 SF building located at 123 Corporate Drive and Primary Care Plus occupying an 8,271 SF building at 131 Corporate Drive. The Property offers investors dual income streams with a premier corporate tenant and an experienced local tenant with proven success in the market.

Investment Highlights:

Investment Grade Tenancy: Primary Care Plus is operated by United Healthcare Services, Inc., a subsidiary of UnitedHealth Group (NYSE: UNH) (Moody’s: A2) (S&P: A+), which is the nation’s largest insurance provider with more than 400,000 employees and $371.6 billion in revenue, as of December 31, 2023.

Long-term Corporate Lease & New 10-year Lease: Primary Care Plus is currently operated under a 7-year lease, with more than 5 years remaining, limited landlord responsibilities, and five (5) 3-year renewal options. Houma Urgent Care Pharmacy will execute a new 10-year Absolute NNN lease upon closing, which will feature 2% annual rent increases and four (4) 5-year renewal options.

Located Along Dominant Retail Corridor: The Property is located one block from W Tunnel Blvd which sees more than 40,000 VPD and is home to Houma’s densest concentration of retail, totaling 1.8 million SF and boasting a 99.3% occupancy rate. The Property benefits from exposure to consumers at nearby national retailers including Walmart, Lowe’s, Home Depot, Target, Hobby Lobby, Marshall’s, Burlington, and Petco.

High-growth, Recession Proof Industry: In recent years, the urgent care market has grown rapidly due to gaps in primary care, convenience, high costs of emergency room visits, and increased investment by health systems and private-equity groups. The market is estimated to reach around $46.7 billion in revenue this year, growing at a CAGR of 3.1% over the past five years, according to a report from IBISWorld. Moreover, United Healthcare served 1.1 million more people in 2023, reportedly driven by growth in commercial and senior offerings.

Urgent Care Replacing Primary Care Physicians: Many Americans are turning to convenient care clinics and urgent care for healthcare services typically performed by a primary care provider, according to a recent survey by RegisteredNursing.org. For an overwhelming majority of survey respondents (77%), the reason why boils down to the immediate availability of care. More than half of respondents (54%) simply want faster service and one in four did not have a primary care provider.