Omotayo Okusanya is a Managing Director in the equity research department at Jefferies & Company, Inc., and Senior Analyst responsible for coverage of real estate investment trusts — REITs. Prior to Jefferies, Mr. Okusanya was employed at UBS Securities LLC for seven years and was the lead analyst responsible for coverage of health care, biotech, self-storage and data center REITs. His research has been recognized in annual analyst rankings published by The Wall Street Journal in 2008 as well as Forbes magazine in 2009 and 2010.
Mr. Okusanya has applied a very rigorous framework onto the various healthcare REITs, with a fair amount of pessimism in the sector. One category that enjoys the Jefferies Managing Director’s favor are the medical office based real estate. In the exclusive interview with the Wall Street Transcript he states that “…a fair amount of them are family or doctor practices, or internist-type practices. However, you also see a lot of specialists in medical office buildings as well. And one of the reasons why you’re seeing more and more specialists in medical office buildings is this push by the health care systems to move procedures into the cheapest-cost settings. And you very often find that a lot of procedures can be done on an outpatient basis in the medical office building rather than in the hospital.”
Some specific negative recommendations are also covered in the interview. Mr. Okusanya states that “…on the skilled nursing side, our bigger concern is you may start to see tenant bankruptcies, and it’s going to drive valuation multiples lower for REITs with skilled nursing exposure. Uncertainty around health care reform and weak admission volumes also make it difficult to be bullish on hospitals. So we would not advise investors be very active in the health care REIT area for the next six to 12 months.”
To get the specific picks and pans from the exclusive interview from the highly respected research Managing Director, read the entire report in the Wall Street Transcript.