Occupancy has remained stable throughout 2020 and into 2021, but quarterly absorption reflects some level of negative impact, although short in duration, in the third quarter of last year. While the average each quarter for absorption in the top 50 markets has been around 3.2 million square feet, in 3Q20 that total fell to just 800K. Interestingly, this impact shows to a greater extent in the largest 10 markets.
Healthcare Real Estate Insights and Revista have partnered to create the healthcare real estate industry's most comprehensive survey of outpatient medical construction activity. Revista will tabulate summary results which will be publicized and all survey respondents will be provided summary results including a comparison of how your firm compares to the summed results. Healthcare Real Estate Insights and Revista will also publish rankings.
In the past, the lion's share of MOB development has been self developed by the hospital system or provider. In fact historically, third party development has only represented around a quarter of medical office square feet started. Since 2019, we've been seeing a shift in this dynamic with more and more projects moving forward with a developer/investor driving the project.
Despite the challenges this year with COVID-19, medical office projects continue to break ground. Interestingly, the proportion of 3rd party developed projects starting is increasing as the year progresses.
Last year 77 medical office projects started that will be over 100,000 square feet when completed. That's quite an uptick over previous years when we averaged less than 50.
So much of the conversation in the industry right now is about placing medical services out into the community to be more convenient and cost effective for patients. But what is that community going to look like in 10 years? 20 years? Flexibility becomes the name of the game.
There are currently about 600 medical office projects under way across the country. More than 15 percent of those projects include orthopedics. Why do so many projects include this specialty?
Healthcare Real Estate Insights and Revista have partnered to create the healthcare real estate industry's most comprehensive survey of outpatient medical construction activity.
The overall construction pipeline, comprised of Hospitals and Outpatient MOBs under construction and in late planning, stands at $104.4B..
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.