Site To Do Business Office

A Positive Prognosis

A father-and-son partnership found success using Site To Do Business to meet growing demand for medical office space in South Carolina.

A sign you're doing things right in commercial real estate is repeat business. What better stamp of approval from a client than another opportunity? For Laurens and Chisolm Nicholson, a father-and-son team of CCIM designees in South Carolina, that first step - that first job well done - included discussions about rethinking just went into the ideal location.

A pediatric internal medicine group met with the Nicholsons to find a site for a new facility in Greenville. The clients' thinking was pretty straightforward - they had two locations already in operation, so the idea was to place a third roughly in between them. Sounds simple enough.

“We did the initial analysis for them and laid out all the available sites,” Chisolm Nicholson says, noting their plan was to own the buildings and lease them to the pediatric group. “But then I said, 'Oh, by the way, that's not where all the doctors are moving.' We don't want to own in the area at the end of the day, so that was something we had to work out.”

Due to a recent relocation of an area hospital, the Nicholsons moved the target for the new location to try to get as close as possible to the new hospital. A site was selected, building commenced, and now the pediatric medical group operates a bustling facility in close proximity to the hospital campus.

“Running a needs analysis, we could identify exactly where there was a demand gap. It's a lot easier to take that information to a client and say, 'Here's hard data showing this business is needed in the area.' ”

With the next opportunity, the pediatricians came back to the Nicholsons looking to open another location. The CCIMs then leveraged tools available through Site To Do Business to identify markets with the greatest need for pediatrics. 

“During the needs analysis phase, we were tasked with a lease/own alternative scenario to help the doctors maximize the deployment of capital,” Chisolm Nicholson says. “But we had two problems - their existing lease was expiring soon, and the group did not want to pay the holdover penalty or renew.” 

With the clock ticking, father and son started crunching the numbers.

“Running a needs analysis, we could identify exactly where there was a demand gap,” Chisolm Nicholson says. “It's a lot easier to take that information to a client and say, 'Here's hard data showing this business is needed in the area.' Identifying that gap in supply almost makes it a no-brainer.”

STDBMap

A drive-time map for the Powdersville, S.C., area provided potential tenants with a clear visual representation of how a potential site would fit with existing and potential clients. 

With decades of experience in the area, the Nicholsons examined the market at a greater depth leveraging the tools available to all CCIMs through Site To Do Business. Eventually, the two identified a former Rite-Aid location in Powdersville, S.C., that stood out for its existing advantages and future potential.

“It was in the middle of a high traffic area with a 30,000-plus daily traffic count across from a medical complex, Chick-Fil-A, and Super Walmart,” Laurens Nicholson says. “After getting in touch with the owner's broker, we discovered two other parties also had interest in the property, so we needed to act quickly.”

Conducting a development analysis with their local partner, Creative Builders, the Nicholsons intended to split the property between the 5,557-sf pediatric medical practice and 4,500 sf of leasable space. Using Site To Do Business, they identified a significant supply gap in the market for pediatric dentists, a potential use only bolstered by the neighboring pediatric medical practice. To locate a potential tenant, the Nicholsons conducted targeted marketing through Site To Do Business. But discussions of leasing the property with one interested party didn't go exactly as planned.

“Not everything went to plan since we wanted to hold the asset, but the pediatric dentist group insisted on purchasing,” Chisolm Nicholson says. “They offered a reasonable price at a market capitalization rate, so we ended up with a win-win.

“And if we can use these tools to help create value, we know anyone who holds the designation can.”

Using Site To Do Business, the Nicholsons identified a significant supply gap in the market for pediatric dentists, a potential use only bolstered by the neighboring pediatric medical practice.

Also, considering the growth in demand for medical office in the Greensville area, the Nicholsons, who don't exclusively deal in the sector, expect to have more transactions like these two in the coming years

“We've seen strong development in Greensville as a whole,” Chisolm Nicholson says. “Some small groups are leaving the large hospital systems - something that we saw in the sector before COVID-19. But it's definitely a trend and something we hope to capitalize on in the future.”


For more on this topic, check out Site to Do Business for commercial real estate professionals. 

Nicholas Leider

Nicholas Leider is senior content editor for Commercial Investment Real Estate. Contact him at nleider@ccim.com.

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