Lillibridge signs agreement with VHA

CHICAGO, May-9 2005 — Lillibridge, one of the nation's largest private health care real estate firms, has signed an agreement with VHA Inc., a national health care provider alliance. The contract demonstrates the firm's market leadership position.

"We're delighted to work with VHA and to extend our services to their members," said Todd W. Lillibridge, chairman and chief executive officer of Lillibridge. Lillibridge will offer its full-service real estate capabilities to enhance the real estate operations, financial position, and growth strategies of VHA's 2,200 member health care organizations.

VHA is a national alliance of leading not-for-profit health care organizations that work together to improve the health of the communities they serve. VHA delivers industry leading supply chain management services and enables regional and national member networks to improve clinical and operational performance and drive sustainable results. Based in Irving, Texas, VHA has 18 local offices serving members across the United States. Member organizations range from single 50-bed facilities to large, integrated health care systems made up of multiple hospitals, physician clinics and support care sites.

"There is a great ‘fit' between our business cultures, commitment to customer service, and approach to quality," said Sydney P. Scarborough, executive vice president of Lillibridge. "Both our organizations believe that we will only be successful as long as our clients are successful."

Positioned for Growth

The VHA announcement comes on the heels of the news that Lillibridge has acquired the assets of Mediplex Medical Building Corporation (MMBC), a well-known medical real estate developer based in Plano, Texas. And last week, Lillibridge announced the acquisition of a portfolio of 10 medical office buildings totaling over 435,000 square feet from SSM — St. Louis in Missouri.

"We are building our business based on the needs of the market," said Ms. Scarborough. "With the unprecedented growth of the outpatient delivery system, our health care clients need a partner that not only has depth of experience and geographic reach to service their needs, but is connected to the industry. And strategically, we have a more efficient vehicle to deliver those services to VHA hospitals."

About Lillibridge

Lillibridge provides real estate services and capital exclusively to hospitals and health care systems. As "The Total Healthcare Real Estate SolutionSM" the company offers a full complement of capabilities — buys and develops medical office and outpatient / ambulatory care facilities; provides program management services to coordinate, plan, and manage the building and/or renovation of acute care hospitals, medical office buildings, ambulatory care facilities, imaging centers, cancer treatment facilities, etc.; offers strategic leasing and comprehensive development services; provides asset and property management services; and advises clients on a wide variety of strategic, financial, and operational real estate issues.

Lillibridge's national scope encompasses more than 250 hospitals and health care systems; 6,000 physicians and hospital tenants, a track record of over 150 completed development projects, and 8.5 million square feet of properties across 40+ states. Headquartered in Chicago, Lillibridge has three regional offices and local offices in 27 markets.

Background / Industry Update

Technological innovation and consumer demand for health care services have resulted in unprecedented growth of the outpatient delivery model, as well as an increased need for new hospitals, facility expansion and renovation. The need for capital to fund the future has never been greater, yet hospitals are faced with significant pressures on earnings and cash flow limiting the ability to generate capital for investment. Allocation of capital to the right projects, efficient management of real estate assets, and distribution of outpatient services to capture market share are required to enhance the hospitals' cash and cash flow.

To meet their strategic goals and position their organizations to take advantage of market dynamics, hospitals need to ask themselves:
Should we consider a new medical building to house ambulatory services and physician offices?
Assuming we can retain necessary controls, is monetization of real estate an option to help fund our capital plans?
Would offering physicians an ownership interest in medical offices support our physician recruitment and retention strategies?
Do we have the internal resources and experience to plan, build, and manage the implementation of our campus redevelopment plan and major expansion projects?
Is outsourcing property management an option to improve real estate financial and operational performance?
Do we have an inventory of our real estate assets and do we know how they're performing financially and operationally?
Do we have a strategic real estate plan that identifies assets for disposition, acquisition and development?
Do we need a reuse plan for older and obsolete facilities?
How will we identify appropriate expansion sites?

To assist VHA members with their health care real estate needs, Lillibridge offers a full complement of capital and real estate services:

Capital for medical office and ambulatory care facility monetization and development
Program management services to coordinate, plan, and manage the building and/or renovation of acute care hospitals, medical office buildings, ambulatory care facilities, imaging centers, cancer treatment facilities, etc
Comprehensive development services for medical office and outpatient facilities, including capital investment
Asset and property management services
Strategic, financial and operational real estate advisory services