From the earliest days, there was a clear vision. Todd Lillibridge set out to establish a new niche market that didn’t even have a name: healthcare real estate. Now, Lillibridge Healthcare Services is the largest player in the nation.
The Lillibridge Story
In 1984, at age 28, Todd made a personal capital investment in the company and became President of Murdoch, Coll & Lillibridge.
Turns out, physicians are very desirable tenants because they move so infrequently. Retention was a very important aspect of business success then ... and it still is today. The group found a new direction that would be key to their success: they would build a national business by parlaying their extensive knowledge and experience in commercial real estate into success in the healthcare industry.
The company was successful at building the business, but it became apparent that short-term property management agreements created a frequent churn that wasn’t helpful for long-term growth. Where was the opportunity for the future?
Sitting at the end of a pier on a lake in Michigan, a concept began to crystallize for Todd. He knew the US healthcare real estate market was extremely large (about $1 trillion), highly fragmented (owned by many different entities), and medical office was roughly a third (39%) of that pie, or $300 billion. He also knew healthcare was a smart choice, as demand would only grow as baby boomers aged, and he recognized that healthcare systems owned millions of dollars of real estate. He asked himself a simple question: could the real estate owned by healthcare systems be used to grow their services and build more market share for them?
Lillibridge was way ahead of the curve in recognizing that hospitals’ and health systems’ real estate held opportunities for growth if they could just unlock the value from their bricks and mortar. Lillibridge was positioning itself as the leader in a new niche market that didn’t even have a name yet — and it would become an important real estate sector.
By the late 2000s, Lillibridge had enjoyed an extraordinary run with its original institutional investors, but with the benefit of experience, it was time to start looking at options.
At that time, the Lillibridge team had taken the firm to more than $1 billion. During this period, there were many discussions with alternative capital partners, including public healthcare REITs — one of which was Ventas, a leading healthcare REIT in the US.
On July 7, 2010, Lillibridge was acquired by and became a wholly-owned subsidiary of Chicago based Ventas, Inc. (NYSE: VTR), an S&P 500 healthcare real estate investment trust (REIT). Together, Ventas and Lillibridge became the market-leading, fully integrated medical office and ambulatory care developer / owner and property manager. This powerhouse combination would help Lillibridge’s clients achieve their strategic and financial objectives during an era of healthcare reform and economic uncertainty.
Ventas’s strong balance sheet and access to capital allowed Lillibridge to continue to invest in its existing facilities, quickly and efficiently develop projects without the need for external funding, acquire (monetize) existing healthcare facilities and reduce transaction risks through fast and reliable project execution.