Physicians Realty Trust's merger to more than double its Third Ward jobs count

Physicians Realty Trust is hiring more accountants for its Third Ward office through a merger with the larger Healthpeak Properties Inc. of Denver, and it expects to have 100 people there by the end of next year.

Inside the office building it owns at 309 N. Water St. in Milwaukee's Third Ward neighborhood, Physicians Realty Trust now oversees a portfolio of about 278 clinic and hospital buildings that are leased to health care providers. But a lot more work is heading its way as the Milwaukee-based company merges with the larger Healthpeak.

The combined holdings of the two companies will have about 753 properties and about 52 million square feet of outpatient medical facilities and laboratory space to manage.

“Over the past two months, we’ve had a number of job postings,” said John Thomas, Physicians Realty president and CEO. “It’s a progression. You don’t want to just flip a switch and take a team and manage three times the size of our current company.”

The Milwaukee office has filled about 15 new accounting jobs since late October, when the merger with Healthpeak was announced, said Mark Theine, executive vice president of asset management for Physicians Realty. That brings its total headcount to about 60.

Thomas expected the hiring of additional accountants would bring the Milwaukee office to about 100 people by about the end of 2025.

“We don’t have a fixed target yet,” he said. “We just know we need a lot more people.”

Physicians Realty’s accounting operation in Milwaukee helped make the merger possible. Healthpeak contracts with outside property management firms to oversee its medical office buildings, while Physicians Realty does that work itself. The result is very few redundant positions between the two companies and a financial benefit to bringing the management of Healthpeak’s buildings in-house, Thomas said.

“There’s a revenue stream that goes along with that activity,” he said. “That revenue stream has historically gone to third parties. Now it will come to the company. That’s a big part of the synergy value.”

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Milwaukee was also an attractive location to hire the accountants who oversee the financial books and rent logs for those properties, Thomas said. The area offers good access to accounting and real estate talent thanks to its existing universities and businesses, he said.

“It’s a great cost of living compared to say, California, where a lot of their current back-office accountants are,” he said.

Thomas said he is a resident of the Third Ward and expects to remain there. He will become vice-chairman of the board of Healthpeak after the merger. Former Wisconsin Gov. Tommy Thompson, Physicians Realty board chairman, and three other members of the Physicians Realty Trust board will also gain seats on the Healthpeak board.

The merger was approved by both firms’ shareholders on Feb. 21 and is expected to close March 1. The combined company will keep Physicians Realty Trust’s “DOC” ticker symbol in the New York Stock Exchange, but it will operate as Healthpeak and have its headquarters in Denver.

Through the merger, Physicians Realty Trust's shareholders can trade one of their common shares for 0.674 of a newly issued share of Healthpeak, according to filings with the U.S. Securities and Exchange Commission. Healthpeak’s stock was valued at $16.79 at the close of the market on Thursday, and Physicians Realty’s stock was at $11.33.

After the merger, Healthpeak’s current shareholders will own approximately 77% of the combined company’s stock, and Physicians Realty Trust shareholders will own approximately 23%.