The Shift to Outpatient Care: Opportunities in Healthcare Real Estate

Dylan Silver (00:00.802)
Hey folks, welcome back to the show. I’m your host Dylan Silver and today on the show I have Joshua Pardue in Tampa, Florida, commercial investor. Josh, welcome to the show.

Joshua Pardue (00:14.167)
I’m Scott Dillon, appreciate you having me today.

Dylan Silver (00:16.8)
Absolutely. At the top of the show, I always like to talk about how folks got into the real estate space. How’d you get in, Josh?

Joshua Pardue (00:24.753)
It started out in undergrad renovating houses. Did that while in school. Eventually got the license, set up a FHA credit line, had a different entrepreneurial business. I was taking that money and putting it putting into real estate while studying finance. And then when I got done with undergrad at that point.

brokerage, FHA credit line, that. Realized I wanted to build towers and do something bigger, so I’d sold off that business. Moved into Colliers International for a while, doing some commercial sale, lease back, net lease, healthcare, and different deals in the southeast. And then moved to New York City, where we…

the business was raising debt equity in the back in investment sales on single tenant net lease assets while the market in Florida was falling apart 2008, 9, and 10 formed GMP development and JPRE development a couple of firms that did distressed assets and single tenant net lease development and you know fast forward today and all those companies are still running strong fortunately and just blessed like you said blessed America.

Dylan Silver (01:33.486)
God bless America. Josh, did I hear you correctly? You were doing fix and flips in undergrad?

Joshua Pardue (01:40.471)
Yeah, had a business that was bringing people from the college at USF to downtown to go to events. And it started making money. And I had some extra cash. And I realized I need to do something with it. And so I bought a house and then put in, it was only $4,000 $5,000. But you put the tile, the lighting, the nice paints. And I put it to how I wanted to live in it for a few months. And then realized the rent was a few hundred bucks more a month based on these upgrades. So I moved to another one.

and then rented the house out and just kept doing that on my nights and weekends while in school. This is, yeah, this is downtown Tampa.

Dylan Silver (02:15.758)
This was Tampa.

Okay, so Tampa story I have. remember going to Tampa because my grandfather had retired down in Tampa. Is there by any chance of bush gardens near that area? Okay, I’m thinking of the right area. So that was the draw. I didn’t realize that I didn’t realize what I was getting into at the time, but we ended up looking at homes. And I distinctly remember, because I’m in New Jersey, born and raised in New Jersey, I distinctly remember being in Tampa.

Joshua Pardue (02:28.47)
There is a bush guard. That’s one of the things that we out.

Dylan Silver (02:47.97)
looking at these beautiful homes. They were on the smaller side. I don’t know the square footage, but they were they were smaller homes, but they had like indoor pools and like beautiful deck like the architecture of these homes and they were not outrageously priced. I don’t remember exactly what year this was, but it must have been like three to six. I’m going to say, you know, and so

Joshua Pardue (03:10.422)
Yeah. It’s got up 06, 07, 8, like 9, 10, everyone else. But then what’s been crazy since COVID in 2020, that’s where it’s been crazy because houses have doubled in three or four years.

Dylan Silver (03:24.866)
Yeah, yeah, yeah. So when you were when you were doing this, was the real estate market in Florida still like untapped gold or was it more like what it is today where it was like everyone’s going there?

Joshua Pardue (03:40.137)
It was certainly a lower basis than where things are at today, but it still was a healthy market and that we knew that people were moving to the state.

And I just say that since COVID and this little last run felt unsustainable because it was just so hot. But historically, it’s grown pretty good. then, course, 2008, 2011, 2012 changed a lot during that period. But it brought it back down to a lower basis to grow at again. But the way I think about it now is Tampa and Jacksonville.

still like we were talking before about West Palm Beach, Fort Lauderdale, Boca, Miami, that area is still significantly more expensive. So presumably these other markets have a lot of room to grow up.

Dylan Silver (04:27.182)
So when you go to New York for career opportunities, are you sad to leave Florida? Because I told you before we hopped on, I’m moving to Fort Lauderdale, I don’t know how, but I’m getting there. And I’m like, you left paradise, I don’t understand.

Joshua Pardue (04:37.706)
Thank you.

No, not at all. think maybe I was born a glutton for punishment. I liked working really hard. So was 2011 when I moved to New York. When I moved up there, I had a decent little successful brokerage business and a decent investment business and RA tax returns, but they wouldn’t even rent me a place in Midtown. They’d go, you’re not from here. You don’t have this. You don’t have that. And I’m like, no, it’s fine. I eventually had to pay a full year of rent.

As soon as I got to the city, I like, welcome to New York City. I had to the full year of rent, cut a check just to tell them, like, no, no, I’m okay, I’m good, just to get into the city. There was just a lot of learning. I made that mistake, won’t make it again, coming from Florida, moving to New York City. But from my perspective, when I was young, I heard if you can make it here, you can make it anywhere, referring to New York. And I’m like, all right. It was kind of like a challenge.

Dylan Silver (05:23.618)
That’s true.

Dylan Silver (05:27.896)
Ha ha ha ha ha.

Joshua Pardue (05:28.842)
I love it as a flirt. grew up surfing and enjoying the great state of Florida and I’m still obviously back here now trying to improve my state of development projects, large-scale commercial. But at the same time, going to New York was a charm for me. But after eight, nine, ten years, I realized that I either have to make a life decision or go back to where I’m from and make a more of an impact.

Dylan Silver (05:51.854)
Hmm. Was it anything to do with the actual city and the climate or was that just an afterthought?

Joshua Pardue (06:00.119)
I’ve always loved Florida and I always loved the beaches and all those different things and I still do. think it’s, I wake up pretty motivated and I enjoy running hard. appreciate it what the Northeast had to offer. Like in the cultural fit and energetic fit, I might fit better. But as an overall quality of life, you know, I fit better, like Florida is a better fit. And then what in West Village, you know, lower Manhattan.

Dylan Silver (06:10.904)
Yeah!

Joshua Pardue (06:26.166)
fluent. had a historical unit there and I was out of this nice dinner. There you’d spend $250, $300 for two people to eat and you’d literally leave so hungry you had to buy a slice of pie on the way home for $3.00. That’s how expensive it was there. It was like $7,000 for one bedroom. You know this is going back to 2012 or 13 today that same thing.

Dylan Silver (06:43.854)
I Yeah, that same one bedrooms, 12 grand, 14.

Joshua Pardue (06:50.701)
So I enjoyed the culture in that, but at the same time, I found myself one night out at dinner and I was rude, like nine or 10 o’clock at night on a Friday, I felt rude to the server.

And I said, wait, wait, wait, wait, that’s not who you are. You’re from the South, you’re from Florida. Don’t let the Northeast get you so amped up. And around then is when I had that and then New York State audited me on a hospital that I built, let’s see if I can get the show, in Denver, Colorado.

with a Florida-based business, that’s a $50 million hospital that we sold off. It was my biggest gain in my career. And three or four years later, New York State sent me a letter. They wanted seven figures of tax. I’m like, wait, I should pay tax in New York State. That’s a Florida-based business with a Colorado hospital. Ultimately, they got me to pay and I had to sell some other properties in order to pay. And I’m like, between those few things, I recognized it was time to enjoy the great state of Florida.

Dylan Silver (07:19.941)
wow.

Dylan Silver (07:48.482)
Wow, that scares me. I don’t know how they got their money, but Uncle Sam’s gonna get his money. That scares me.

Joshua Pardue (07:55.799)
Well, if you sell a big business and you move to Florida just to avoid New York State or any state, California for that matter, I get the auditor coming after you. But I was actually from Florida, just up there for one business opportunity. But my whole life portfolio, they look at things like where are your doctors? Where’s your art? Where’s your watches? Where are your family? Where’d you go to school? All those things for me was Florida. So the fact that they went after me that aggressively and won was concerning.

Dylan Silver (07:58.103)
Yeah.

Dylan Silver (08:25.816)
That is concerning, you know, hospital commercial deals. you’re actually the second person that I’ve had on the podcast who’s involved in commercial deals regarding hospitals. I actually had a developer or a builder who builds hospitals and he told me that for, you know, emergency room hospitals, that there’s 800 contractors in the country roughly that are qualified to build these hospitals.

So were you involved in the building of the hospital or were you involved in brokering the sale of the hospital?

Joshua Pardue (09:00.06)
That number probably sounds right, I’ve never fact checked it. I’ve done all the above, but on this one we owned, we bought the land, we signed a 20 year lease, we brought in the debt and equity, and then we brought in the hospital tenant on the 20 year lease, and so we’re the owner developer.

On some of them, we’ve also been the general contractor, which is the distinction, right? Some people call it builder. There’s a developer that’s the guy that owns the land and brings everything together. And then there’s the GC that actually performs the physical construction. We’re often the developer, and we’re occasionally the GC and the broker.

Dylan Silver (09:37.102)
So coming from an investment background, going into building hospitals, I’m imagining you had to have lots of strategic partners in place to help you get this off the ground. But are there additional hoops or qualifications that any investor involved at any level in building a hospital needs to meet in order to be part of the deal?

Joshua Pardue (10:00.98)
Yeah, I’d say, look, it’s like anything else. Before that hospital, I probably was involved in 30 other commercial medical transactions, ranging from lease deals to other construction projects. And through that, you build your database of tenants, banks, investors, architects, GCs. And you have to be at that point in your journey in order to be in the opportunity. I remember that we found this project, there was a

a GC in the southeast, who was trying to take it on themselves. They got into trouble buying the land. And I think they even wanted some steel coming in and stuff, whatever not. And we realized it was a defunct deal, but it had a long-term tenant want in the space. So we came in, brought in new money, fixed that. then eventually, once we had it stabilized, brought in institutional money to do the whole $40 million development project.

based on that lease that we have. And then from there, we’re able to exit at 50 and then figure out how to split up the money amongst various parties.

Dylan Silver (11:02.808)
So Josh, hearing this story, makes me think, you know, people have a strong personality traits and skills that they’re able to bring to any deal. Was your biggest skills in raising capital, was your biggest skills in putting together the partners, finding the deals? know, New York, living in New York, I’m thinking raising money. Where was your biggest skill set?

Joshua Pardue (11:29.334)
Yeah, great question, Dylan. So look, the three things to think about to be successful at anything in this vertical. Relationships, liquidity, and expertise. Relationships, actually treat them genuine. They’re lifelong assets. They’re not just a one and done deal, okay? Liquidity. In order to go from being a broker, a residential, or whatever that’s doing commercially, you have to start setting aside some money. You have to get to do the drawings, the initial pursuit. Bring the team, get them a hotel, whatever it

get stuff going and then expertise. Choose whatever you enjoy doing.

and get really good at it. Okay? And if you trust all those things, they all come together. So to your point, for me, I didn’t come from a big corporation or come from a family with money. I came from nothing. And I want to build my development business. So I had to keep building those three things. But my expertise, I became pretty proficient at healthcare transactions, development, understanding the tenants. And I also, to your point, when I moved to New York, that business was raising money for other people’s projects.

equity and the investment sales. So I would learn how those deals are structured. So when I had my own projects, I had a database and I had the know-it-all to bring it together and everyone knew that I knew what I was doing. And it took all those things happening to become the developer of a project. It’s almost 100,000 foot hospital with three ORs, 50 overnight beds. Because when you’re the developer, you’re the hub.

and you have the GCE, the architect, the money, the tenant, all the engineers and vendors. But took all those things to get to that point.

Dylan Silver (13:05.111)
What was the feeling like when you sold that hospital? Was there like a high of, wow, I sold a hospital?

Joshua Pardue (13:13.558)
It was almost surreal. to your point, I’d feed the deal on the exit and I was the guy doing the development.

But it was almost like after, I don’t know, three or four years of working on something, it almost seemed unreal. I remember we were doing the spreadsheets and looking at what to do. And of course then the different partners were like, wait, wait, wait, we think it’s like this. And you have to kind of work through all that at the end as you’re figuring out how to distribute the money. But it was a heck of a good feeling. And what you don’t do in that situation is kind of look back and reflect. Like, man, it took…

It took all these steps. remember the first time I made a cold call to a medical tenant or a medical building owner. I never raised a dollar. You reflect back on that and just say, bless America. system, America works. You just have to get up and apply yourself every day.

Dylan Silver (14:10.542)
So what was the next couple of months? Was it decompression? What happens after you sell a hospital, Josh? I wanna know.

Joshua Pardue (14:17.233)
No, that develops a hospital doesn’t decompress. It’s not a part of the job. Your decompression is figuring out like, what am I gonna do with that money on the next, on the current projects that you’re going after in those chapters? Decompressing isn’t one of my skill sets.

Dylan Silver (14:21.538)
Hahaha

Joshua Pardue (14:40.054)
But what I tell everyone, this is super important as well for your audiences, you should only, I don’t believe in the word work, okay? You should spend your time on things that you enjoy, right? And that you’re good at and that you can create value out of, okay? And then if you can just capture a piece of that value creation, don’t ever think about the word work. What am I good at? Okay, what do I enjoy? And how can I create value? You can write down a piece of paper, those three lists. And if you focus on that,

and you for it doesn’t feel like it’s not work anymore because you’re just doing what you should do. And then as you get older and you start doing hospitals, it starts being fun. Then the next thing that happens is just who you are and what you do. There’s no differential between work and everything else. Like in the nighttime, I leave the office, I go home and I eat and like I make sure the house music’s on, dim the lights. You know, I spend like maybe 20 minutes walking around on the phone. I’m like, okay, I’m going to sit down at my house and go back to the computer and keep progressing.

projects for great tenants and urban cores. We do some single-tenant build-a-suit work still, and some of the stuff that we’re doing now is trying to fix cool downtowns. And so we’ve got some massive projects and urban cores in Florida. And I feel like when I’m working on that, I’m making an impact on the community.

Dylan Silver (15:48.951)
Hmm.

Dylan Silver (15:57.538)
have a question selfishly and you may have to pass on this one because you may say, look, that’s not my area of expertise. But the final four was just in San Antonio, Texas. I did five years in San Antonio, San Antonio was selling cars. So the final four is down there. They have a what’s called the Alamo Dome, which I believe was going to get a professional football team down there as something went south with the deal. It’s currently like college football and I think vacant a lot of the time. But there’s also

Joshua Pardue (16:03.083)
You

Joshua Pardue (16:08.97)
Go Gators.

Dylan Silver (16:25.13)
a six flags down there. have a lots, lots of different developing areas. You know, I joke about this is pickleball going up on every corner. But it’s predominantly a military city. Do you ever look at cities across the United States and you’re like, there’s actually a lot of opportunity there that’s on tap, like, for instance, San Antonio has the river walk, right? Do you ever just look at other cities and are like, there’s opportunity here?

Joshua Pardue (16:30.624)
and we’ll

Joshua Pardue (16:49.536)
yeah, the Riverwalk Pool, San Antonio as a whole I think is really neat because it holds heritage. What’s the area with the cows and the horns and they do the walk every day? But I’ve been a fourth, but you’re right, San Antonio has a neat Riverwalk. They don’t have any of the fourths.

Dylan Silver (16:59.691)
that’s Fort Worth. That’s Fort Worth.

Joshua Pardue (17:11.254)
That’s a beautiful spot. My understanding of San Antonio as a Floridian investor is that it’s doing well, but of course Houston and Austin get all the glitz and have been going nuts. But those other markets like Fort Worth are doing good. You know, look, obviously Texas and Florida have benefited from a lot of stuff above our pay grade, political and tax and different things we don’t need to get into. But I really like communities like that. I think you do really well.

Dylan Silver (17:19.885)
Yeah.

Joshua Pardue (17:40.438)
trying to find 10 to 50 acres right outside of the urban core and master plan a community there that ties in that local grit and character of San Antonio.

Dylan Silver (17:51.278)
Yeah, I would love that. I just wanted to throw that in there. They’ve got actually in San Antonio. I don’t know if this is fact or fiction, but they have the Alamo, right? Remember the Alamo in the center of the city and they have skyscrapers that are kind of distant from it. And I’ve been told, I don’t know if this is true in good Texas fashion. You cannot build a building that will cast a shadow on the Alamo.

Joshua Pardue (18:00.383)
Yes.

Joshua Pardue (18:15.415)
That’s just good legislation right there.

Dylan Silver (18:17.346)
That’s great, Like, let’s go Texas, but I digress, I digress.

Joshua Pardue (18:21.718)
Find some warehouses, abandoned warehouses and land that’s close to the urban core, but not so much in the urban core that Dylan and his boys can’t compete because the big institutions and developers are already on it. Find something that’s just right off the

edge, slowly come in and try and buy the centerpiece of it, the couple of centerpieces, and slowly try to buy and contract all the pieces around it until you have enough mass that you can do something neat with some … because there’s a multifamily anchored mixed use with retail down and a multi. You can kind do that anywhere, but if you can get a little bit of land under control, build your own little community.

Dylan Silver (19:03.662)
Josh I’m calling my buddy Matt after this business plan chat GPT we’ll get it going pivot pivoting

Joshua Pardue (19:06.166)
Just send me the sites. I’ll help you put them under contract and go after it. This is great.

Dylan Silver (19:12.378)
Thank you, man, let’s go. Let’s go see, this is how it happens. I tell people fanatical networking, networking junkie, just keep shaking hands, meeting people, or the new meeting people is these podcasts and so on and so forth. pivoting a bit here, Josh, I talked with a woman who built a career in the healthcare space. She ended up selling her business as now a commercial real estate agent specializing in

helping doctors and nurses buy practices effectively, so have equity in the practice that they have, and also advising them to a degree. One of the interesting topics that we hit on is this movement away from hospitals to, I forget the term that she used it, but like outpatient care. And this is personal, because I went to an MRI and it was the, I wanna say,

Joshua Pardue (19:46.016)
Thank

Joshua Pardue (19:59.593)
out.

Dylan Silver (20:06.518)
It was like right next to a high end Italian restaurant and next door is MRI. And I walked in Josh, they didn’t really do anything except here’s the machine. What kind of music do you want? Put the thing on and I leave. They didn’t tell me the results, nothing. And so.

Joshua Pardue (20:21.59)
with the imaging and send it back to your dot, right?

Dylan Silver (20:24.438)
Right, exactly. And so are we gonna see more of this, like the outpatient type of deal? And was this caused because of wait times or something in hospitals?

Joshua Pardue (20:34.282)
Good question. Weight times is part of the driving factor, but it almost always comes back to Mr. Green. see, Mr. Green and the cost and efficiencies are what drive, for better or worse, drives free market capitalism and gains. And so what the medical healthcare real estate industry has realized over decades and is continually trying to improve is how much…

What’s the best use of space, time, and resources? And what should my land underneath be doing? So when you’re on hospital campus, for example, that’s very valuable real estate that can hit insurance companies for big dollars. Now someone can do imaging there, or you can send that patient from the hospital back to the primary care that’s less valuable real estate. And that primary care or orthopod, for example, doing like a broken bone, can then send you to an MRI.

And it’s still owned by the same investors and hospital groups, but that MRI is run a thousand dollar procedure there, still hitting the same insurance code as the hospital, but they’re not on campus expensive. So the overhead is lower. So if the revenue is the same, but the real estate cost is lower, then the profit is higher. And that’s all this, that out, when you hear outpatient, it’s just the hospital’s medical providers realizing there’s a more efficient way to do it outside the hospital from a cost perspective.

Dylan Silver (21:55.502)
I see. Okay, there’s a big business in hospitals that I was exposed to last week and now it’s got me thinking. I was like, can anyone own a MRI facility in Tampa?

Joshua Pardue (22:09.28)
to owning the building, of course anyone can own it. Owning the business is a little bit more challenging. You have to know how to start them. 10, 15 years ago, there was an MRI.

wave where a bunch of people were starting and launching, but you know, have to be able to have some physicians, you know, as well to start that group. In the human surgery space, we’ve been involved in a couple of human surgery centers that form, and you have a bunch of doctors, you have to get together with a management company. That group forms a new LLC that provides surgeries in your center. And what you’re expecting is those doctors, they’re high value, they’re bringing a lot of procedures, know, procedures that are going to

$10,000 per whack. Well, then a hospital eventually comes in and buys that business. So if you’re the building owner, like we’ve developed a surgery center in Orlando, it’s like 15,000 square feet. And then the docs and management company were in there and they were on a lease with us, but we knew the local hospital was going to come in and buy the practice. So once that hospital system bought it, this is multi-billion dollar hospital systems that everyone knows by name. Once they buy it, your odds of getting your rent are good, but once a hospital buys

they’re even better. Your credit rating went up for your tenant as a result.

Dylan Silver (23:23.47)
Do you see, that for all Americans, it might benefit people if doctors have an equity stake in the practice that they’re in?

Joshua Pardue (23:35.446)
So for a long time, a lot of doctors did want to that. Of course, still plenty do. With that said, overall, you’re seeing the &A within the activity, where individual practices are going into regional practices. Regional practices are going into big corporate national practices. And it’s getting absorbed up due to efficiency in dollars. That trend has been going on for a while in the health care space, yeah.

Dylan Silver (23:54.606)
I

Dylan Silver (23:58.648)
So your journey from school to New York now to developing hospitals, and it seems like you’ve carved out a niche in the healthcare space. Did you see this when you were leaving school? Did you see this, hey, I’m gonna be doing this? Or was this a mix of divine intervention and focus growth?

Joshua Pardue (24:16.63)
Great question. would say that when I was in business school, like I knew from being in middle school, I was selling bubble gum in high school. was set up solar tanks for money. Like I always knew I was into business, but then I realized that finance and investments was something I didn’t know, marketing and sales I was comfortable with. So I studied finance and investments. Like once I got on that path, I started owning the houses. I realized like you can go into all other forms of finance or you can go into real estate investment and raising money and that.

And so I started having success going down that vertical. I didn’t know exactly where I wanted to end up. I always knew that I was probably a business owner. I was probably an investor. And what I liked the most was this goes back to sports. I liked whether it was high school football, when it was all serious, or co-ed ball with.

I like to organize people together and get them excited to go achieve a mission. And I feel like with real estate investment and putting together deals and development, all you’re really doing is organizing people for a shared goal. And there’s different skill sets from that.

than being an investor. And I just kind of knew that was the direction I wanted to go in. Learning healthcare, real estate, was certainly worked well. Learning finance, like niche finance strategies, certainly worked well. And then my passion has been taking kind of free cash flow and entrepreneurial profits from those ventures and buying urban properties in Florida. Because I like the cool factor. When I lived in New York and I’ve traveled to 40-something countries, I always find

the boutique hotel in the neat little part of town like you’re in the Riverwalk in San Antonio would be a good example. Well like all over the great state of Florida there’s these cities and towns that are growing but they have these older urban cores that were big in the early 1900s like when the state started and then people moved to suburbia.

Joshua Pardue (26:07.562)
Well, like one of my personal passions now is helping work on those downtown areas and make them cool again by bringing in cool, you know, mixed use projects and tenants and making downtown Florida markets great again.

Dylan Silver (26:13.654)
Yeah.

Dylan Silver (26:22.582)
I love that and to your point Josh, I feel like I don’t wanna do any the heavy lifting completely alone. I was going back and forth with this, my mentor right now just calling leads. I’m like, let’s get someone else to call these leads with me. I don’t wanna be in a shed over here calling them by myself. Let’s at least have some camaraderie over here for the, come on now. But we are coming up on time here, Josh. Where can folks go to get ahold of you?

Joshua Pardue (26:37.462)
Yeah, I it’s cool.

Joshua Pardue (26:49.096)
Yeah, at this point, I’ve got 20 something years of online. If you search Joshua Pardue, you’ll find a whole bunch of different, we’ve got websites, of course, the LinkedIn, all the social media. What I’m really excited about is I’ve started getting to where I would kind of mentor, lecture, make jokes with the different younger guys within our companies. And they said, hey, those sound bites like pigs get fed, hogs get slaughtered, for example. You ever heard that?

Dylan Silver (27:17.742)
I love it, I don’t know what it means, but it’s ringing with me.

Joshua Pardue (27:19.87)
Nids get fed, hogs get slaughtered, means don’t be greedy. You’re working on a deal. Get a deal done, don’t fight. So I started creating these jargons and different things. And so you’ll see now we have a social media presence. And I’m excited to grow the YouTube channel for Joshua Pardue. For example, because on there we do technical and like case studies about how to do projects and how to raise money and how to do these things. But what I’ve really grown to love is the mindset.

It’s like behind this discussion. How do you inspire people to go out and do this in the country? And so you’ll find a lot of stuff on YouTube and all the different LinkedIn channels.

Dylan Silver (27:58.914)
Yeah, I’m gonna go check it out to our listeners. Check out Joshua Pardue online. Josh, thank you for coming on the show.

Joshua Pardue (28:06.113)
Thanks a Dylan, appreciate you having me.