1. t Real Estate Consulting Group w/ WebPE © 2001 Arthur Andersen All rights reserved. How GIS and portal can help manage Health Care Assets P. Barton DeLacy and Fred S. Illich November 12, 2001 HC01_P02C

2. © 2001 Arthur Andersen All rights reserved. How GIS and Web Portal Can Manage Real Estate Health services must manage assets like a business Excess Property should be monetized Resources directed to revitalize and expand core facilities GIS an important tool to to support strategic planning Interactive web-based portals can effectively publish GIS maps Portal hosting technology brings GIS functionality to the desktop HC01_P02C

3. © 2001 Arthur Andersen All rights reserved. The Business Problem: How best to realize potential value in real estate holdings? Consider: –Geography: Spread out locations Remote decision makers –Real estate data: complex dynamic Disparate information sources –Value dynamics: Asset value optimized when property managed as portfolio Information needs to be in one place

4. © 2001 Arthur Andersen All rights reserved. Andersen’s RE portal: What is it? Web enabled tool to evaluate corporate assets Treats real estate as a portfolio What does it do? –Quick visual access to properties in portfolio –Three view display shows: Thumbnail photo of subject Parcel map Brief description –Real time access to disparate databases –Protocols assure security HC01_P02C

5. © 2001 Arthur Andersen All rights reserved. Introduction Public Health uses GIS technology –To track disease –To study market penetration –To map and plan healthcare delivery Health services must better manage real estate assets Fair value often exceeds book value Off - strategy property should be monetized freeing up funds –to expand core facilities –to better serve patient needs HC01_P02C

6. © 2001 Arthur Andersen All rights reserved. GIS as Asset Management Tool See what is owned - all in one place Displace dispersed assets GIS links databases to particular assets –Property descriptions –Third party reports (appraisals, environmental studies) –Digital photos –Additional maps HC01_P02C

7. © 2001 Arthur Andersen All rights reserved. GIS Healthcare themes Pattern of surrounding land use Changing demographics Market competition Improve strategic decisions –Model “what if” scenarios –Display analysis through varying map views HC01_P02C

8. © 2001 Arthur Andersen All rights reserved. Conveying GIS information is problematic Best suited to an internal intranet Difficult to send images or analysis if client lacks –Software GIS Expertise Proprietary rights and license requirements –Hardware Server A personal computer with capacity to run program HC01_P02C

9. © 2001 Arthur Andersen All rights reserved. Low cost web portal can act as a simple interface Replicates functionality of GIS within parameters No dedicated resources needed Interactive to manage complex real estate and facility portfolios Well suited to healthcare clients HC01_P02C

10. © 2001 Arthur Andersen All rights reserved. Why Healthcare Organizations face Real Estate Challenges RE needs management to enhance overall performance RE historically viewed as a commodity- now a strategic asset Core services spread beyond campuses to –Medical office buildings –Congregate care homes –Warehouses and other properties Property as contributions in lieu of cash Ensure room for expansion HC01_P02C

11. © 2001 Arthur Andersen All rights reserved. Mergers, Acquisitions and Reorganizations force greater scrutiny of Real Estate assets Some experts argue hospitals have no business owning real estate Federal legislation will shift the medical office ownership from hospital-physician collaborations to third parties Seismic upgrades necessary on many facilities Outpatient services growing HC01_P02C

12. © 2001 Arthur Andersen All rights reserved. Real Estate risks As an asset class, real estate is typically illiquid May be contaminated Improvements can deteriorate Fixed in place - can become obsolete when demand shifts Special purpose designs can become obsolete with changes in technology HC01_P02C

13. © 2001 Arthur Andersen All rights reserved. Case Study Regional hospital determined to implement an institutional strategic plan Master plan to govern core facilities Real estate challenges include: –Widely dispersed real estate holdings –Inadequate parcel descriptions –Scattered/missing records –Poor internal communication –Unclear/nonexistent policies regarding development/disposition HC01_P02C

14. © 2001 Arthur Andersen All rights reserved. Case Study - Methodology Identify holdings and enter into spreadsheet or database Street addresses matched with property parcel ID numbers –Field inspections Parcels then mapped with ArcView and county parcel data Resulting maps displayed with specific themes –Dispersion of assets - using a regional map to show location points –Parcel ownership around central campus - emphasizing key unowned inholdings –Vacant and underutilized land around campus - suggesting development opportunities HC01_P02C

15. © 2001 Arthur Andersen All rights reserved. Case Study - Methodology (cont.) Individual parcel descriptions included –county assessment information –a digital photo –digital parcel map Properties sorted by use and location can then be placed in the same binder as tangible deliverable HC01_P02C

16. © 2001 Arthur Andersen All rights reserved. HC01_P02C

17. © 2001 Arthur Andersen All rights reserved. HC01_P02C

18. © 2001 Arthur Andersen All rights reserved. HC01_P02C