How large is the medical office sector and how fast is it growing? Who are the sector’s major owners and investors, and what type of financing is available? How does the industry perform during typical real estate cycles, and how has medical office performed in recent years? For answers to those and
Revista and HREI unveil the first independently verified research project to look exclusively at the development of medical office buildings (MOBs) and other outpatient facilities
ARNOLD, Md., and MINNETONKA, Minn., March 29, 2017 – How big is the market for the development of medical office buildings (MOBs) and other outpatient facilities, and who are the most active developers?
In the first independently verified research project to look exclusively at those questions, Revista and Healthcare Real Estate Insights (HREI) found that outpatient medical real estate development projects totaling nearly $7.7 billion in construction value and 19.4 million square feet were completed in 2016. Another 17.3 million square feet of outpatient projects with a value of almost $6.5 billion were started.
The top five outpatient developers in terms of square footage started or completed last year were
This report covers Hospital and Medical Office Construction projects that are new, expansions or replacements greater than 7,500 square feet and $5 million in value. It provides detail on the overall pipeline (under construction and late planning), analysis of recent completions in 2016 and expected completions in 2017. Construction starts are trended quarterly and projected out 2 quarters.
In 2013, there were 271.6 million insured and 1.3B square feet of MOB space in the US..
Overall, the sector is performing near cyclical highs in terms of occupancy and NOI growth. The occupancy rate as of the 2nd quarter 2016 was 92.5%.
The report shows the construction pipeline is growing. The total US medical real estate construction pipeline now stands at $102.1 B which is up 5.1% from the year end 2015 figure of $97.1 B.
Three 300-million-dollar hospital projects have broken ground in the last two months – and they’re outside the top 100 metros. These projects are large in scale and bring in national firms to design and manage construction.
We often show in our reports and presentations the metros that have the most MOB construction activity. Frequently this ends up being the usual suspects - New York, Chicago, Los Angeles etc. and this is simply because these are the largest overall markets so they will tend to have more space being built. To broaden the spectrum, let’s take a look at metros that are the most active in comparison to their existing inventory.
2015 was a banner year for medical real estate. Transactions were at an all-time high, construction and development grew and fundamentals are near cyclical highs. We invite healthcare executives to join us for this informative, data-driven webcast in which Revista will provide an overview...
Overall, Revista reports the total construction pipeline at $97.1 Billion at year end 2015; this is up 12% from $86.7B during the first half of 2015.