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Image published by matthews.com with the article “Mavis Acquires Pep Boys: What It Means for Automotive Real Estate It probably comes as no surprise what’s leading this month’s market discussion. My phone has been ringing, my inbox has been filling up, and if I waited much longer to write about it, I’m fairly certain the carrier pigeons would have been next. In July 2026, Icahn Enterprises announced the sale of Pep Boys’ operating business to Mavis Tire Express Services Corp. for approximately $700 million, nearly a decade after acquiring the company for $1.03 billion. The transaction brings one of the most recognizable names in automotive service under the umbrella of the industry’s largest independent operator while significantly expanding Mavis’ West Coast presence. Following the acquisition, Mavis now operates more than 4,400 locations and is estimated to control roughly 22%–25% of the U.S. tire retail market. From a real estate perspective, however, the purchase price is only part of the story. Did Icahn Really Lose $300 Million? One of the biggest misconceptions surrounding the deal is that Icahn took a $300+ million loss. That conclusion overlooks a key part of the original acquisition: Icahn purchased both the operating business and a substantial portfolio of owned real estate. The current transaction involves the operating business, while Icahn is believed to be retaining approximately 30%–40% of the underlying real estate. Depending on how those assets are ultimately monetized, how Mavis handles existing lease obligations, and what new lease structures emerge, investors could gain access to automotive real estate that has effectively been off the market for nearly a decade. For investors active in the automotive net lease space, that could be one of the most interesting pieces of this transaction. The real estate that remains behind may ultimately prove just as important as the operating business that changed hands. What Happens to the Larger Pep Boys Locations? Pep Boys historically developed larger prototypes that combined automotive service bays with an auto parts store, creating a true one-stop-shop model. Mavis is not in the auto parts business, which raises an obvious question about what happens to all of that excess retail space. New Jersey may offer a clue. Over the past several months, I’ve noticed multiple Mavis locations there operating alongside Advance Auto Parts within the same building, and I would not be surprised to see a similar strategy used with some of the larger Pep Boys properties. Mavis could retain the service portion while subleasing excess space to retailers such as AutoZone, O’Reilly Auto Parts, or Advance Auto Parts. That approach would allow the company to maintain control of strong automotive locations while helping offset occupancy costs on oversized properties. In my opinion, Pep Boys has historically had some of the strongest site selection in the automotive service sector. Giving up those locations simply because the buildings are larger than Mavis needs may not make sense when the excess space can potentially be monetized. What Existing Mavis Landlords Should Watch Adding nearly 800 locations creates tremendous scale, but it also gives Mavis more opportunities to evaluate overlapping stores, underperforming locations, and weaker real estate. That becomes even more relevant given continued speculation surrounding a future public offering and the traditional private equity strategy of building scale ahead of an eventual exit. For landlords, the takeaway is not to panic but to pay attention. Lease renewals, relocations, store consolidations, and potential redevelopment of larger Pep Boys properties will provide valuable insight into which locations Mavis views as essential to its long-term portfolio. There could also be upside for existing landlords if Mavis assumes Pep Boys lease obligations under Mavis Tire Express Services Corp. Bringing hundreds of additional operating locations under the same corporate entity could create a larger and more diversified guarantor, although the specific lease assignment and guarantee language will ultimately determine the strength of that credit. Mavis Could Set the New Benchmark Over the next several years, Mavis’ portfolio decisions could help define what the automotive service industry values most in a location. Site quality, rent levels, building size, market overlap, and long-term residual value will all come into focus as the company works through its expanded portfolio. For landlords and investors, those decisions could become a useful benchmark for evaluating automotive real estate. When the largest independent tire and automotive service operator in the country decides which stores to keep, relocate, consolidate, or redevelop, the broader market should be paying attention. Staying Busy Outside of the Mavis-Pep Boys headlines, we recently completed another successful lease extension on a Firestone property in a core Philadelphia market. The property now has a fresh 10-year lease and will soon be coming to market for the first time in more than 60 years. Jake and I continue to work with landlords through increasingly complex lease negotiations, whether Mavis is requesting rent concessions or Bridgestone is citing store performance to support lower economics. The negotiation landscape is changing, and owners with current market intelligence are in a much stronger position when it comes time to sit across the table from a tenant. The Pep Boys acquisition is only beginning to play out, and the real estate decisions that follow may ultimately be just as important as the transaction itself. Those decisions, and what they tell us about the future of automotive real estate, are what I’ll be watching most closely. JanCarlo Ahumada Associate 8/13/26”

Image published by matthews.com with the article “Selling Your Medical Practice and Real Estate: What Owners Need to Know Physicians who own both their practice and the real estate hold two valuable, separately marketable assets. Today both are in high demand: private equity and strategic buyers are competing for physician practices, and institutional real estate investors are competing just as hard for the MOB and ASC real estate. While it may seem logical to pursue the two transactions separately, doing so could significantly impact overall value. The practice (the “OpCo”) and the building (the “PropCo”) are connected by a single document, the lease agreement, and the rent set in that lease moves value between the OpCo and PropCo. The rent established in that lease effectively shifts value between the two entities. For OpCo, rent is an expense that reduces earnings. For PropCo, rent is recurring income that supports the building’s value. Setting rent without considering both sides can increase the apparent value of one asset while unintentionally reducing the value of the other. OpCo is generally valued as a multiple of EBITDA, while PropCo is valued by applying a capitalization, or “cap,” rate to Net Operating Income (“NOi”), which is largely driven by annual rent. Because the physician is a related party to both entities, the rent must also fall within a defensible Fair Market Value (“FMV”) range, typically established through comparable market data. The objective, therefore, is to evaluate the applicable EBITDA multiples, cap rates, and FMV rent range together to determine the rent level that maximizes the combined value of both OpCo and PropCo. Owners are more likely to achieve the strongest overall outcome when the practice and real estate are evaluated through a coordinated strategy, even if only one asset is currently being considered for sale. Lease terms should be structured to preserve value, maintain flexibility, and support a future OpCo or PropCo transaction. Engaging experienced real estate professionals and healthcare advisors or investment bankers who understand the relationship between the two assets is therefore critical to positioning both for the most favorable result. Physician Growth Partners helps you select the right healthcare investment banker or advisor is critical when evaluating a transaction involving a physician group or media practice. Matthews™ brings expertise in valuing, marketing, structuring, and negotiating transactions involving medical real estate. This paper explains how the two assets are connected, illustrates the financial impact, compares sequencing options, and outlines the advisory team needed to protect the value of the entire package. Two Markets, One Decision For physicians who own both assets, the current timing may be particularly attractive for evaluating a transaction. 2025 healthcare private-equity deal value: $191B YoY growth in physician-group deal count: ~18% 2025 medical real-estate investment volume: $14B+ Avg. medical-office cap rate, Q1 2026: 6.9% A strong market for physician practices Healthcare private equity delivered a near-record 2025, with disclosed deal value of roughly $191 billion across an estimated 445 buyouts, the second-highest annual total on record, behind only 2021.1 The physician medical group subsector remains one of the most active corners of the healthcare M&A market: its share of health-services deal activity expanded through 2025, deal count grew roughly 18% year-over-year, and the subsector generated nearly three times the transactions of the next-largest healthcare services subsector. The demand drivers are structural. U.S. health spending reached about $5.3 trillion in 2024 (roughly 18% of GDP) and is projected to climb past 20% of GDP by 2033. 3 The population continues to age, Americans 65 and older are projected to grow about 34% by 2036, while the Association of American Medical Colleges (AAMC) projects a shortage ofup to 86,000 physicians over the same horizon. 4 Necessity of care plus a supply-demand imbalance keeps buyers engaged. Consolidation is occurring across nearly all physician specialties, including dental, dermatology, ophthalmology, cardiology, gastroenterology, urology, orthopedics, women’s health, and ENT. Practices affiliated with ambulatory surgery centers, behavioral health, and home infusion are also drawing significant investor interest. This heightened level of activity reflects a steadily broadening buyer universe and gives physician-practice sellers alternatives beyond traditional private equity-backed platforms. An equally strong market for healthcare real estate Medical office buildings and ASCs are among the most defensive assets in commercial real estate, and capital has poured back in. Investment volume surpassed $14 billion in 2025, up roughly 34% year-over-year,6 and momentum accelerated into 2026: first-quarter volume rose 78% year-over-year. 7 Pricing strengthened in step, the average medical-office cap rate fell to about 6.9% in Ql 2026, its first reading below 7.0% since late 2024, with institutional-quality assets pricing closer to the low-6% range. Fundamentals support the demand. Average asking rents reached record levels, occupancy held near 92-93%, the sector posted multiple consecutive quarters of positive absorption, and medical-office sale prices ran well above traditional office. Investors value the combination of credit-worthy tenants, long lease terms (commonly 7-10+ years), and built-in rent escalations that hedge inflation; all supporting the recession-resistant nature of healthcare providers as added security. How the Lease Links Practice and Real Estate Value Practice owners considering the sale of the operating business, the real estate, or both should evaluate the assets as part of a coordinated strategy. Even when only the OpCo or PropCo is being considered for sale, coordination remains essential to preserving flexibility and maximizing value. Because these transactions often represent a one-time opportunity, the structure should maximize the combined value of the OpCo and PropCo while preserving strong buyer interest in each. This includes negotiating lease terms that strike an appropriate balance: a lease that is overly tenant-friendly may reduce the attractiveness of the PropCo, while one that is overly landlord-friendly may weaken interest in the OpCo. Valuation, however, should not be the sole consideration. Cultural alignment is also essential, particularly when selecting a buyer for the OpCo. Two assets, two valuation languages. A practice is valued on a multiple ofEBITDA (its earnings). Anything that lowers EBITDA lowers the practice’s value by that multiple. A building is valued by capitalizing its net operating income, essentially its annual rent, at a cap rate (the inverse of EBITDA multiples); the lower the cap rate, the higher the value. At a 6.5% capitalization rate, each $1 of sustainable annual rent translates to approximately $15 of building value (1/.065 = 15.0x), reflecting an implied valuation multiple of roughly 15 times rent. Rent is the same dollar on both sides. Rent is an expense to the practice and income to the building. Every dollar of rent reduces practice EBITDA and increases building NOI at the same time. Because the two assets are valued on different multiples, where you “park” that dollar changes the total. Every dollar of rent reduces practice EBITDA and increases building NOI at the same time. The tension. Physician-owned rental rates must fall within FMV for Stark/Anti-Kickback purposes. That said, FMV is often a range based on market comparables, set rent at the low end of FMV and the practice’s earnings look higher while the building’s income, and value, looks lower. Set rent on the high end of FMV and the reverse is true. It is tempting to push rent toward whichever asset you expect to sell for the richer multiple. It is essential to rely on experienced advisors to evaluate transaction multiples, capitalization rates, and the fair market value range for rent, with the goal of maximizing value across both assets. A Real-World Example Illustrative only, actual figures vary by specialty, market, and deal. Investors typically value a medical practice by applying a multiple to its EBITDA, while the real estate occupied by the practice is valued by capitalizing its rental income at an appropriate cap rate. These are two different multiples, and they are rarely equal. In today’s market, well-located healthcare real estate with strong lease terms and credit often trades at a cap rate of 6.5% or higher, which is the equivalent of roughly 15.4x EBITDA multiple. Physician practices, depending on specialty and scale, might trade at high single digits or low double digit EBITDA multiples. That gap creates an opportunity most physician owners never consider. Here is why rent matters: every additional dollar of rent reduces the practice’s EBITDA by one dollar while increasing the property’s NOI by the same amount. As a result, the rent level shifts value directly between OpCo and PropCo. If PropCo is valued at 15.4 times EBITDA (inverse of a 6.5% cap rate) and OpCo is valued at an implied multiple of 8 to 12 times NOI, setting rent at the higher end of the fair-market range generally preserves more value in the higher-multiple PropCo. Conversely, decreasing rent transfers value to OpCo. Therefore, the optimal rent should be established within the defensible fair-market range only after evaluating the relative OpCo multiple and PropCo capitalization rate. This coordinated analysis helps determine the rent level that maximizes the combined proceeds and achieves arbitrage. The coordination dividend The reason these advisors must work together is that the most important decisions often sit at the intersection of their responsibilities. The rent established in the lease by the real estate advisor directly affects the practice’s EBITDA and, therefore, the value assessed by the M&A advisor. If rent is set without considering applicable valuation multiples and capitalization rates, significant value may be left on the table. Similarly, the lease terms required by the practice buyer become key drivers of the real estate’s value. If those terms are negotiated by the M&A advisor and legal counsel without input from the real estate advisor, the property’s future value and marketability may be constrained before it is ever offered for sale. Transaction sequencing also requires input from the entire advisory team because it can materially affect taxes, valuation, and the marketability of both assets. Selecting a path without evaluating all three dimensions may prove more costly than any individual negotiation point. When the advisors work together, the owner is better positioned to maximize the value of the entire package. When they operate separately, with the banker focused only on the practice and the real estate advisor unaware of the operating transaction terms, value can be lost between the two processes. Effective coordination is therefore essential to achieving the strongest overall outcome. Michael Moreno Executive Vice President & Senior Director 8/10/26”

Image: matthews.com

Matthews Real Estate Investment Services

Saks Emerges from Chapter 11 with a More Focused Retail Footprint Saks Global’s emergence from Chapter 11 offers another example of how major retailers are reassessing their physical footprints and putting greater emphasis on productive, strategically located stores. The company emerged from restructuring as Exemplar Luxury Group, the parent company of Saks Fifth Avenue, Neiman Marcus, and Bergdorf Goodman. With debt reduced by nearly 75% and approximately $500 million in new financing, the retailer enters its next chapter with a significantly stronger balance sheet and a much leaner portfolio. For retail real estate investors, however, the bigger story is what happened to the store base. Prior to the restructuring, Saks operated 33 Saks Fifth Avenue locations, 36 Neiman Marcus stores, Bergdorf Goodman, and roughly 70 Saks Off 5th locations. Today, the portfolio includes 15 Saks Fifth Avenue stores, 33 Neiman Marcus locations, Bergdorf Goodman, and just 12 Saks Off 5th stores. That reduction reinforces a trend we continue to see across the retail sector: more doors do not necessarily mean a stronger retailer. Retailers are becoming increasingly disciplined about where they allocate capital, with a greater focus on store-level performance, market positioning, and locations that support long-term profitability. For landlords and investors, that puts even more importance on understanding the underlying fundamentals of an individual asset rather than relying solely on the strength of the name on the lease. Tenant credit will always matter, particularly in net lease. But Saks is a good reminder that credit is only one part of the underwriting equation. Store performance, surrounding demographics, access, visibility, rent relative to market, lease structure, and the underlying real estate all play a role in determining long-term value. This is especially relevant when evaluating retailers undergoing a broader portfolio optimization. A closure in one market does not necessarily indicate weakness across an entire brand. In many cases, retailers are using these periods to exit underperforming stores while directing more resources toward locations they believe have the strongest long-term potential. Saks’ strategy appears to follow that playbook. Management is putting greater emphasis on its core luxury customer, stronger vendor relationships, personalized service, and a more integrated approach between its physical stores and digital channels. The goal is not to rebuild the footprint that existed before bankruptcy, but to operate a smaller platform more efficiently. For retail and net lease investors, the takeaway is straightforward: real estate fundamentals matter. As retailers continue to refine their portfolios, the strongest locations should remain highly relevant, not simply because of the tenant occupying them today, but because of the quality of the real estate underneath the lease. Understanding that distinction is becoming increasingly important when evaluating both risk and opportunity across the retail investment market. Daniel Gonzalez First Vice President & Associate Director 8/14/26

Union County’s industrial market strengthened in Q2 2026, supported by improving tenant demand and limited new supply. The market recorded 690,000 SF of positive net absorption, helping vacancy fall to 5.3% from 6.4% in Q1. Asking rents reached $14.50/SF, with annual rent growth…

RetailNet Lease

Updated todayPublished Aug 14, 2026

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Image: matthews.com

Matthews Real Estate Investment Services

Mavis Acquires Pep Boys: What It Means for Automotive Real Estate It probably comes as no surprise what’s leading this month’s market discussion. My phone has been ringing, my inbox has been filling up, and if I waited much longer to write about it, I’m fairly certain the carrier pigeons would have been next. In July 2026, Icahn Enterprises announced the sale of Pep Boys’ operating business to Mavis Tire Express Services Corp. for approximately $700 million, nearly a decade after acquiring the company for $1.03 billion. The transaction brings one of the most recognizable names in automotive service under the umbrella of the industry’s largest independent operator while significantly expanding Mavis’ West Coast presence. Following the acquisition, Mavis now operates more than 4,400 locations and is estimated to control roughly 22%–25% of the U.S. tire retail market. From a real estate perspective, however, the purchase price is only part of the story. Did Icahn Really Lose $300 Million? One of the biggest misconceptions surrounding the deal is that Icahn took a $300+ million loss. That conclusion overlooks a key part of the original acquisition: Icahn purchased both the operating business and a substantial portfolio of owned real estate. The current transaction involves the operating business, while Icahn is believed to be retaining approximately 30%–40% of the underlying real estate. Depending on how those assets are ultimately monetized, how Mavis handles existing lease obligations, and what new lease structures emerge, investors could gain access to automotive real estate that has effectively been off the market for nearly a decade. For investors active in the automotive net lease space, that could be one of the most interesting pieces of this transaction. The real estate that remains behind may ultimately prove just as important as the operating business that changed hands. What Happens to the Larger Pep Boys Locations? Pep Boys historically developed larger prototypes that combined automotive service bays with an auto parts store, creating a true one-stop-shop model. Mavis is not in the auto parts business, which raises an obvious question about what happens to all of that excess retail space. New Jersey may offer a clue. Over the past several months, I’ve noticed multiple Mavis locations there operating alongside Advance Auto Parts within the same building, and I would not be surprised to see a similar strategy used with some of the larger Pep Boys properties. Mavis could retain the service portion while subleasing excess space to retailers such as AutoZone, O’Reilly Auto Parts, or Advance Auto Parts. That approach would allow the company to maintain control of strong automotive locations while helping offset occupancy costs on oversized properties. In my opinion, Pep Boys has historically had some of the strongest site selection in the automotive service sector. Giving up those locations simply because the buildings are larger than Mavis needs may not make sense when the excess space can potentially be monetized. What Existing Mavis Landlords Should Watch Adding nearly 800 locations creates tremendous scale, but it also gives Mavis more opportunities to evaluate overlapping stores, underperforming locations, and weaker real estate. That becomes even more relevant given continued speculation surrounding a future public offering and the traditional private equity strategy of building scale ahead of an eventual exit. For landlords, the takeaway is not to panic but to pay attention. Lease renewals, relocations, store consolidations, and potential redevelopment of larger Pep Boys properties will provide valuable insight into which locations Mavis views as essential to its long-term portfolio. There could also be upside for existing landlords if Mavis assumes Pep Boys lease obligations under Mavis Tire Express Services Corp. Bringing hundreds of additional operating locations under the same corporate entity could create a larger and more diversified guarantor, although the specific lease assignment and guarantee language will ultimately determine the strength of that credit. Mavis Could Set the New Benchmark Over the next several years, Mavis’ portfolio decisions could help define what the automotive service industry values most in a location. Site quality, rent levels, building size, market overlap, and long-term residual value will all come into focus as the company works through its expanded portfolio. For landlords and investors, those decisions could become a useful benchmark for evaluating automotive real estate. When the largest independent tire and automotive service operator in the country decides which stores to keep, relocate, consolidate, or redevelop, the broader market should be paying attention. Staying Busy Outside of the Mavis-Pep Boys headlines, we recently completed another successful lease extension on a Firestone property in a core Philadelphia market. The property now has a fresh 10-year lease and will soon be coming to market for the first time in more than 60 years. Jake and I continue to work with landlords through increasingly complex lease negotiations, whether Mavis is requesting rent concessions or Bridgestone is citing store performance to support lower economics. The negotiation landscape is changing, and owners with current market intelligence are in a much stronger position when it comes time to sit across the table from a tenant. The Pep Boys acquisition is only beginning to play out, and the real estate decisions that follow may ultimately be just as important as the transaction itself. Those decisions, and what they tell us about the future of automotive real estate, are what I’ll be watching most closely. JanCarlo Ahumada Associate 8/13/26

Union County’s industrial market strengthened in Q2 2026, supported by improving tenant demand and limited new supply. The market recorded 690,000 SF of positive net absorption, helping vacancy fall to 5.3% from 6.4% in Q1. Asking rents reached $14.50/SF, with annual rent growth…

Net LeaseRetail

Updated todayPublished Aug 13, 2026

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Image: matthews.com

Matthews Real Estate Investment Services

Beyond the Slice: What Pizza Hut’s Sale Signals for Restaurants and Retail Real Estate Pizza Hut is entering a defining moment. After years of declining sales, Yum! Brands has agreed to sell the iconic pizza chain in a transaction valued at approximately $2.7 billion. Under the agreement, LongRange Capital will acquire Pizza Hut’s operations outside Mainland China, while Yum China Holdings will purchase the China business. The deal follows ten consecutive quarters of declining U.S. same-store sales, a trend that has weighed heavily on one of the industry’s most recognizable brands. Investors welcomed the announcement, sending Yum! Brands’ stock up roughly 3% after the news broke. The sale represents more than a change in ownership. It reflects the challenges many legacy restaurant brands face as consumer preferences shift, operating costs rise, and competition intensifies. It also underscores a broader trend. Restaurant operators are reevaluating their portfolios, investing more selectively, and adapting their physical footprints to better align with today’s market. Those decisions continue to reshape retail real estate. Private Equity Sees Opportunity, but Success Is Far from Guaranteed Private equity firms continue to pursue established restaurant brands with strong name recognition but declining performance. The strategy is straightforward: acquire a recognizable company, improve operations, increase profitability, and position the business for long-term growth. Restaurants, however, have proven difficult to turn around. Several well-known chains, including Red Lobster and TGI Fridays, struggled after years of private equity ownership. Their experiences sparked industry-wide discussions about the risks associated with heavy debt loads, aggressive cost-cutting, and reduced capital investment. Those challenges do not define every private equity acquisition, but they have made franchisees, landlords, and investors more cautious when another legacy restaurant brand changes hands. Pizza Hut’s future may be different. LongRange Capital has built its reputation by focusing on operational improvements and long-term value creation rather than short-term financial engineering. Even so, the firm inherits a brand that must regain relevance in one of the restaurant industry’s most competitive categories. A Comeback Built on Nostalgia Rather than relying exclusively on menu innovation or digital ordering, the company has invested in an experience many consumers still remember. Updated versions of the chain’s iconic red-roof restaurants are bringing dine-in service back to the forefront, creating spaces that capture the family atmosphere that helped make Pizza Hut a household name. The strategy reflects a broader trend across retail and hospitality. Consumers continue to value memorable in-person experiences, and nostalgia has become an effective way for established brands to reconnect with longtime customers. Today’s pizza market looks very different than it did when Pizza Hut dominated the category. Third-party delivery platforms have expanded consumer choice, independent operators compete more effectively than ever, and national chains continue investing in technology, loyalty programs, and operational efficiency. Pizza Hut must balance its heritage with a modern customer experience if it hopes to regain market share. The Pizza Category Is Undergoing a Broader Reset The pizza category has become increasingly competitive as operators navigate higher labor costs, inflation, changing consumer spending habits, and slowing traffic growth. Many brands are reassessing where they invest, how they grow, and which locations continue to support long-term profitability. Papa Johns recently announced plans to close underperforming restaurants across multiple states as part of a broader effort to optimize its footprint. The decision reflects a larger industry trend. Expansion is no longer the primary objective. Operators are focusing on stronger markets, improving unit economics, and building healthier portfolios rather than simply adding more locations. That shift has important implications for commercial real estate. As brands become more selective, the quality of the real estate often becomes just as important as the strength of the tenant. What This Means for Commercial Real Estate For commercial real estate professionals, Pizza Hut’s sale is about far more than a corporate transaction. Private equity ownership often accelerates portfolio reviews. Companies evaluate store performance, remodel successful locations, relocate restaurants, renegotiate leases, and close sites that no longer fit their long-term strategy. Those decisions create opportunities for landlords, developers, brokers, and investors while also increasing the importance of understanding tenant strategy. Brands looking to reinvent themselves frequently pursue second-generation restaurant space that better supports today’s operating model. Modern prototypes, smaller footprints, efficient drive-thrus, and highly visible trade areas have become priorities as operators seek greater efficiency and stronger returns. The transaction also reinforces an important investment lesson. A recognizable tenant does not guarantee a successful real estate investment. Investors should evaluate both the strength of the operator and the long-term fundamentals of the underlying real estate. Strong demographics, excellent visibility, high traffic counts, and redevelopment potential often determine an asset’s value long after a particular tenant leaves. As restaurant operators continue optimizing their portfolios, investors who focus on durable real estate instead of brand recognition alone may be better positioned to navigate future market changes. More Than a Restaurant Deal Pizza Hut’s sale reflects more than the future of a single restaurant chain. It illustrates how legacy brands are adapting to changing consumer preferences, evolving operating models, and growing pressure to improve performance. The transaction also reinforces a broader shift across the restaurant industry. Operators are placing greater emphasis on portfolio optimization, modern store formats, operational efficiency, and locations that can support long-term profitability. Those decisions will continue to influence leasing activity, redevelopment opportunities, and investment strategies across retail real estate. LongRange Capital now has the opportunity to reshape one of the industry’s most recognizable brands. Whether that strategy succeeds will depend on far more than financial restructuring. It will require a compelling customer experience, disciplined site selection, and an operating model that reflects how consumers choose to dine today. For commercial real estate professionals, the sale serves as another reminder that restaurant real estate continues to evolve alongside the brands that occupy it. Investors, landlords, and brokers who understand those shifts will be better positioned to identify opportunities as the next chapter of the restaurant industry unfolds. Vincent Tanzi Associate 8/10/26

Union County’s industrial market strengthened in Q2 2026, supported by improving tenant demand and limited new supply. The market recorded 690,000 SF of positive net absorption, helping vacancy fall to 5.3% from 6.4% in Q1. Asking rents reached $14.50/SF, with annual rent growth…

Retail

Updated todayPublished Aug 10, 2026

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Image: matthews.com

Matthews Real Estate Investment Services

Selling Your Medical Practice and Real Estate: What Owners Need to Know Physicians who own both their practice and the real estate hold two valuable, separately marketable assets. Today both are in high demand: private equity and strategic buyers are competing for physician practices, and institutional real estate investors are competing just as hard for the MOB and ASC real estate. While it may seem logical to pursue the two transactions separately, doing so could significantly impact overall value. The practice (the “OpCo”) and the building (the “PropCo”) are connected by a single document, the lease agreement, and the rent set in that lease moves value between the OpCo and PropCo. The rent established in that lease effectively shifts value between the two entities. For OpCo, rent is an expense that reduces earnings. For PropCo, rent is recurring income that supports the building’s value. Setting rent without considering both sides can increase the apparent value of one asset while unintentionally reducing the value of the other. OpCo is generally valued as a multiple of EBITDA, while PropCo is valued by applying a capitalization, or “cap,” rate to Net Operating Income (“NOi”), which is largely driven by annual rent. Because the physician is a related party to both entities, the rent must also fall within a defensible Fair Market Value (“FMV”) range, typically established through comparable market data. The objective, therefore, is to evaluate the applicable EBITDA multiples, cap rates, and FMV rent range together to determine the rent level that maximizes the combined value of both OpCo and PropCo. Owners are more likely to achieve the strongest overall outcome when the practice and real estate are evaluated through a coordinated strategy, even if only one asset is currently being considered for sale. Lease terms should be structured to preserve value, maintain flexibility, and support a future OpCo or PropCo transaction. Engaging experienced real estate professionals and healthcare advisors or investment bankers who understand the relationship between the two assets is therefore critical to positioning both for the most favorable result. Physician Growth Partners helps you select the right healthcare investment banker or advisor is critical when evaluating a transaction involving a physician group or media practice. Matthews™ brings expertise in valuing, marketing, structuring, and negotiating transactions involving medical real estate. This paper explains how the two assets are connected, illustrates the financial impact, compares sequencing options, and outlines the advisory team needed to protect the value of the entire package. Two Markets, One Decision For physicians who own both assets, the current timing may be particularly attractive for evaluating a transaction. 2025 healthcare private-equity deal value: $191B YoY growth in physician-group deal count: ~18% 2025 medical real-estate investment volume: $14B+ Avg. medical-office cap rate, Q1 2026: 6.9% A strong market for physician practices Healthcare private equity delivered a near-record 2025, with disclosed deal value of roughly $191 billion across an estimated 445 buyouts, the second-highest annual total on record, behind only 2021.1 The physician medical group subsector remains one of the most active corners of the healthcare M&A market: its share of health-services deal activity expanded through 2025, deal count grew roughly 18% year-over-year, and the subsector generated nearly three times the transactions of the next-largest healthcare services subsector. The demand drivers are structural. U.S. health spending reached about $5.3 trillion in 2024 (roughly 18% of GDP) and is projected to climb past 20% of GDP by 2033. 3 The population continues to age, Americans 65 and older are projected to grow about 34% by 2036, while the Association of American Medical Colleges (AAMC) projects a shortage ofup to 86,000 physicians over the same horizon. 4 Necessity of care plus a supply-demand imbalance keeps buyers engaged. Consolidation is occurring across nearly all physician specialties, including dental, dermatology, ophthalmology, cardiology, gastroenterology, urology, orthopedics, women’s health, and ENT. Practices affiliated with ambulatory surgery centers, behavioral health, and home infusion are also drawing significant investor interest. This heightened level of activity reflects a steadily broadening buyer universe and gives physician-practice sellers alternatives beyond traditional private equity-backed platforms. An equally strong market for healthcare real estate Medical office buildings and ASCs are among the most defensive assets in commercial real estate, and capital has poured back in. Investment volume surpassed $14 billion in 2025, up roughly 34% year-over-year,6 and momentum accelerated into 2026: first-quarter volume rose 78% year-over-year. 7 Pricing strengthened in step, the average medical-office cap rate fell to about 6.9% in Ql 2026, its first reading below 7.0% since late 2024, with institutional-quality assets pricing closer to the low-6% range. Fundamentals support the demand. Average asking rents reached record levels, occupancy held near 92-93%, the sector posted multiple consecutive quarters of positive absorption, and medical-office sale prices ran well above traditional office. Investors value the combination of credit-worthy tenants, long lease terms (commonly 7-10+ years), and built-in rent escalations that hedge inflation; all supporting the recession-resistant nature of healthcare providers as added security. How the Lease Links Practice and Real Estate Value Practice owners considering the sale of the operating business, the real estate, or both should evaluate the assets as part of a coordinated strategy. Even when only the OpCo or PropCo is being considered for sale, coordination remains essential to preserving flexibility and maximizing value. Because these transactions often represent a one-time opportunity, the structure should maximize the combined value of the OpCo and PropCo while preserving strong buyer interest in each. This includes negotiating lease terms that strike an appropriate balance: a lease that is overly tenant-friendly may reduce the attractiveness of the PropCo, while one that is overly landlord-friendly may weaken interest in the OpCo. Valuation, however, should not be the sole consideration. Cultural alignment is also essential, particularly when selecting a buyer for the OpCo. Two assets, two valuation languages. A practice is valued on a multiple ofEBITDA (its earnings). Anything that lowers EBITDA lowers the practice’s value by that multiple. A building is valued by capitalizing its net operating income, essentially its annual rent, at a cap rate (the inverse of EBITDA multiples); the lower the cap rate, the higher the value. At a 6.5% capitalization rate, each $1 of sustainable annual rent translates to approximately $15 of building value (1/.065 = 15.0x), reflecting an implied valuation multiple of roughly 15 times rent. Rent is the same dollar on both sides. Rent is an expense to the practice and income to the building. Every dollar of rent reduces practice EBITDA and increases building NOI at the same time. Because the two assets are valued on different multiples, where you “park” that dollar changes the total. Every dollar of rent reduces practice EBITDA and increases building NOI at the same time. The tension. Physician-owned rental rates must fall within FMV for Stark/Anti-Kickback purposes. That said, FMV is often a range based on market comparables, set rent at the low end of FMV and the practice’s earnings look higher while the building’s income, and value, looks lower. Set rent on the high end of FMV and the reverse is true. It is tempting to push rent toward whichever asset you expect to sell for the richer multiple. It is essential to rely on experienced advisors to evaluate transaction multiples, capitalization rates, and the fair market value range for rent, with the goal of maximizing value across both assets. A Real-World Example Illustrative only, actual figures vary by specialty, market, and deal. Investors typically value a medical practice by applying a multiple to its EBITDA, while the real estate occupied by the practice is valued by capitalizing its rental income at an appropriate cap rate. These are two different multiples, and they are rarely equal. In today’s market, well-located healthcare real estate with strong lease terms and credit often trades at a cap rate of 6.5% or higher, which is the equivalent of roughly 15.4x EBITDA multiple. Physician practices, depending on specialty and scale, might trade at high single digits or low double digit EBITDA multiples. That gap creates an opportunity most physician owners never consider. Here is why rent matters: every additional dollar of rent reduces the practice’s EBITDA by one dollar while increasing the property’s NOI by the same amount. As a result, the rent level shifts value directly between OpCo and PropCo. If PropCo is valued at 15.4 times EBITDA (inverse of a 6.5% cap rate) and OpCo is valued at an implied multiple of 8 to 12 times NOI, setting rent at the higher end of the fair-market range generally preserves more value in the higher-multiple PropCo. Conversely, decreasing rent transfers value to OpCo. Therefore, the optimal rent should be established within the defensible fair-market range only after evaluating the relative OpCo multiple and PropCo capitalization rate. This coordinated analysis helps determine the rent level that maximizes the combined proceeds and achieves arbitrage. The coordination dividend The reason these advisors must work together is that the most important decisions often sit at the intersection of their responsibilities. The rent established in the lease by the real estate advisor directly affects the practice’s EBITDA and, therefore, the value assessed by the M&A advisor. If rent is set without considering applicable valuation multiples and capitalization rates, significant value may be left on the table. Similarly, the lease terms required by the practice buyer become key drivers of the real estate’s value. If those terms are negotiated by the M&A advisor and legal counsel without input from the real estate advisor, the property’s future value and marketability may be constrained before it is ever offered for sale. Transaction sequencing also requires input from the entire advisory team because it can materially affect taxes, valuation, and the marketability of both assets. Selecting a path without evaluating all three dimensions may prove more costly than any individual negotiation point. When the advisors work together, the owner is better positioned to maximize the value of the entire package. When they operate separately, with the banker focused only on the practice and the real estate advisor unaware of the operating transaction terms, value can be lost between the two processes. Effective coordination is therefore essential to achieving the strongest overall outcome. Michael Moreno Executive Vice President & Senior Director 8/10/26

Union County’s industrial market strengthened in Q2 2026, supported by improving tenant demand and limited new supply. The market recorded 690,000 SF of positive net absorption, helping vacancy fall to 5.3% from 6.4% in Q1. Asking rents reached $14.50/SF, with annual rent growth…

Healthcare

Updated todayPublished Aug 10, 2026

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Matthews Real Estate Investment Services

The New Reality in Restaurant Net Lease Higher interest rates, tighter lending conditions, and rising operating costs have fundamentally changed how investors evaluate restaurant net-lease assets. Expansion alone is no longer enough to support premium valuations. Today’s market rewards durable cash flow, resilient operators, and real estate with long-term flexibility. This shift began before 2026. By the mid-2020s, restaurant operators had become increasingly selective about expansion. According to ICSC, the number of U.S. restaurants recovered to pre-pandemic levels by 2024, growing from 681,764 locations in 2019 to 687,253 locations in 2024. Despite that recovery, nearly 37% of restaurant operators reported delaying expansion plans because of rising costs and economic uncertainty. The result was a more disciplined approach to growth. Operators were no longer focused on opening as many locations as possible. Instead, they prioritized markets, trade areas, and individual sites that could support long-term profitability. For investors, the same evolution has reshaped underwriting. The key question is no longer whether a restaurant concept is expanding. It is whether the underlying real estate will continue to generate reliable income through changing market conditions. Profitability Has Become the New Battleground Restaurant operators continue to face persistent pressures that are reshaping unit-level economics. Elevated labor costs, higher food prices, and tighter operating margins have made profitability more difficult to sustain, prompting lenders and investors to scrutinize franchisee performance more closely. Consumer behavior is also evolving. The growing adoption of GLP-1 medications has raised questions about long-term food consumption patterns, while declining alcohol consumption among younger consumers is reducing sales in what has historically been one of the highest-margin categories for many full-service restaurants. None of these trends eliminate investment opportunities. They do, however, reinforce the need for disciplined underwriting and a thorough understanding of unit-level performance. In today’s market, the biggest risk is often not when a lease expires, but whether the operator can continue generating the cash flow needed to support it. Finding Mispriced Opportunities The market frequently overvalues lease term and undervalues real estate quality. As a result, some of the most attractive opportunities emerge when investors focus too heavily on tenant concerns while overlooking exceptional underlying locations. Conversely, assets with long lease terms but weak site fundamentals can command premiums that are difficult to justify. Investors should evaluate every restaurant net-lease opportunity through two separate lenses: The durability of the lease The quality of the real estate The strongest investments excel at both. Lease term matters, but it is not the same as lease durability. A 15-year lease only creates value if the rent remains sustainable, the location remains strategically important to the operator, and the tenant can continue generating enough cash flow to support occupancy costs. This is especially important in restaurant real estate, where risk varies significantly by segment. QSR assets often offer the greatest rent durability because value-oriented pricing, drive-thru infrastructure, digital ordering, and strong franchise systems support operational resilience. Fast-casual assets can remain attractive, but investors should place greater emphasis on unit-level sales, local competition, occupancy costs, and concept differentiation. Full-service restaurants require the most conservative underwriting due to higher labor intensity, greater exposure to changing consumer behavior, and potential pressure on high-margin categories such as alcohol sales. This is where real estate optionality becomes critical. When a lease expires, investors do not own a restaurant brand. They own a piece of real estate. Signalized corners, high-traffic corridors, strong demographics, adaptable building formats, and sites with multiple potential users can preserve value even if the current tenant underperforms. A short-term lease on an irreplaceable corner with strong traffic counts, visibility, and redevelopment potential may ultimately offer a more attractive risk-adjusted opportunity than a long-term lease attached to a marginal location with limited alternative uses. In today’s market, the best opportunities are not always the assets with the longest lease terms. They are the assets where rent durability, tenant performance, and real estate quality align. The New Playbook for Restaurant Net Lease Investing Restaurant net-lease investing has entered a new phase. The era when cheap capital rewarded unit growth, sale-leasebacks, and expansion narratives has largely passed. Today’s market demands a more disciplined approach focused on tenant health, rent durability, renewal probability, and real estate optionality. Investors who underwrite both the lease and the dirt beneath it will be better positioned to identify mispriced opportunities, avoid assets whose value depends solely on remaining lease term, and capitalize on the next phase of restaurant net-lease investing. In a higher-cost capital environment, durable cash flow and valuable real estate matter more than growth alone. Chris Naylon Senior Vice President 7/30/26

Union County’s industrial market strengthened in Q2 2026, supported by improving tenant demand and limited new supply. The market recorded 690,000 SF of positive net absorption, helping vacancy fall to 5.3% from 6.4% in Q1. Asking rents reached $14.50/SF, with annual rent growth…

Net LeaseRetail

Updated todayPublished Jul 30, 2026

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