An Overview Of The Medical Office Market

The average asking rent for medical offices reached the highest level on record in the second quarter of 2018, rising 1.4 percent year-over-year to $22.90 per sq. ft., according to a late December report from CBRE.

The firm pointed to tight market conditions and the completion of new, high-quality space as reasons for the continued rent increases.

“Rents increased in two-thirds of the markets tracked by CBRE and grew fastest in some of the markets with the lowest vacancy rates, including Nashville, Manhattan, Louisville, Seattle, and Indianapolis,” Andrea Cross, Americas head of office research, CBRE, said in a statement.

Another factor is that health systems are increasingly using lower-cost outpatient centers. These facilities enable health systems to provide services closer to where patients live. According to CBRE, the total number of outpatient centers grew by more than 50 percent to approximately 41,000 from 2005 to 2016. In addition, outpatient center employment has more than doubled since 2003, and grew 3.5 percent year-over-year in October 2018, compared with 2 percent annual growth in overall healthcare employment.

“Healthcare systems are increasingly catering to patients as consumers—rather than simply users—of healthcare services,” Mark Lamp, executive managing director, healthcare, CBRE, said in a statement. “They are creating outpatient facilities that provide a more ‘hotel-like’ experience—and at a lower cost than the more expensive hospital services—with technology-enabled check-in, abundant natural light and incorporated outdoor spaces, and patient care concierges trained to support guests with any needs.”

On the development front, CBRE‘s report concluded that medical office development strongly correlates with population growth, with Phoenix, Houston, Dallas/Ft. Worth and Atlanta among the top markets for total completions from the third quarter of 2017 to the second quarter of 2018, along with Minneapolis/St. Paul, a leading healthcare cluster. Houston, Minneapolis/St. Paul, Atlanta, Chicago, the Inland Empire, Kansas City and Boston rank among the top markets for square footage under construction.

Click here to view NREI’s ‘An Overview Of The Medical Office Market Slideshow’. This gallery takes a look at the fundamentals in the top 30 markets ranked by vacancy rates as of the second quarter of 2018, but also includes stats on net absorption, asking rents and the amount of space under construction in each market.


Source: NREI

2019 Forecast For New Research Labs: Construction Innovations Help Accelerate Scientific Discoveries

Researchers and other scientists who have access to high-performance research laboratories are pioneering breakthrough discoveries in medicine, science and biotechnology.

From the medical solutions that are the hallmark of Washington University to the vital research that will take place at the National Bio and Agro-Defense Facility (NBAF) in Manhattan, Kansas, sophisticated lab environments support the region’s research-driven enterprises.

Experts in the design and construction of lab spaces believe several factors are shaping the next phase of research environments in 2019 and beyond. Each trend supports the universal goals of accelerating innovation, attracting and retaining top talent, and bolstering an organization’s overall competitiveness.

McCarthy collaborates with world-class architectural and engineering partners in building the next generation of these advanced research facilities.

Innovative Visualization Streamlines Construction

The desire to bring new research space online as quickly as possible is driving a shift toward fast-track construction schedules.

Virtual design and construction technologies streamline the construction process and enable the offsite prefabrication of many building components — from exterior drywall or curtainwall systems to equipment racks, piping, ductwork and electrical conduit.

“Prefabrication helps us save time and optimize quality by assembling components in a controlled offsite environment vs. building them in the field,” says McCarthy Project Director Seth Kelso, who oversees construction of the NBAF project.

Visualization tools such as 3D modeling and virtual and augmented reality allow future users of a space to realistically experience it — and give valuable feedback to improve it — at an early stage when modifications can be made with minimal impact to the budget or schedule.

“It may be difficult for some users to understand two-dimensional drawings or even a 3D model, but with VR and AR, they can put on goggles and be immediately transported inside a space that we’ve modeled,” says Kelso.

In recent years, there’s been an evolution from the traditional design-bid-build method of construction to design-build and other methods where the construction manager is brought onboard at the same time or shortly after an architect is selected.

“I fully support bringing in the construction team as early as possible,” says Josh Meyer, managing principal at Jacobs Engineering. Under his leadership, Jacobs has been involved in more than 300 lab buildings totaling over 50 million square feet. I’m asked by clients all the time how much projects are going to cost, but I’m not a cost estimator. The earlier you bring in people that really understand construction costs and local market conditions, the better.”

Protecting The Health And Safety Of Researchers

Safety is a top priority within every lab environment, but it’s especially vital for public health labs that conduct research related to infectious diseases, biological agents and other sensitive areas.

“Building these high-containment research labs and vivarium spaces like those at NBAF requires specialized equipment and precise construction techniques, with very stringent requirements and no tolerance for deficiencies,” says Kelso.

Located within the Kansas City Animal Health Corridor, the state-of-the-art NBAF facility will study diseases that threaten both America’s animal agricultural industry and public health. To be operated by the U.S. Department of Homeland Security, it will be the only U.S. lab for large animals constructed to meet biosafety level 4 (BSL-4) — the highest containment level established by the Centers for Disease Control and Prevention.

“The NBAF facility is the only lab of its kind at that scale and complexity and, like most U.S. public health labs, it will be the best in the world,” says Daniel Watch, science and technology practice leader at Perkins+Will, the project’s lead architect.

Promoting Team-Based Research

A new era of team-based research has ushered in the need for flexible spaces with advanced technology to facilitate ongoing collaboration among colleagues who may be located down the hall or halfway around the world.

“Today’s organizations are thoughtful about setting up research teams that integrate people from a wide range of backgrounds and locations,” says Watch. “A researcher in St. Louis might be connected to a team in Jeddah, Saudi Arabia, or Beijing, China.”

A growing number of institutions are also building lab environments to accommodate unique collaborations with external partners.

“I’m seeing a lot more maker space, accelerator space and other innovation space that brings in partners from industry, which is exciting,” says Meyer. “If researchers can go from their lab to innovation space that’s really close — either in the same building or nearby on campus — it can help drive innovation.”

Because of the digital transformation of the R&D process, traditional “wet labs” are shrinking while flex space and office areas for computational science are growing. Smaller, more sophisticated lab and medical imaging equipment can be stacked and tied into the technology infrastructure to support data analysis within a compact footprint.

“With the number of high-quality projects that have come online within the last several years, it’s much harder to recruit and retain people in substandard space,” Meyer says. “The competition is fierce and it’s one of the biggest reasons we’re seeing an uptick in the number of new research facilities for institutional clients.”

Just as close collaboration drives successful research, it’s also a key component in the construction of new research facilities.

“Lab projects require ongoing collaboration between design and construction teams, together with the client, to align and achieve project goals,” says Kelso.


Source: St. Louis Biz Journal

Medical City Fort Worth’s New $65 Million Tower Expands ER, Intensive Care Unit

Medical City Fort Worth will begin accepting patients in a new three-story, $65 million tower that expands its emergency services.

The facility includes a new emergency department and intensive care unit (PHOTO CREDIT: Medical City Fort Worth)

The 90,000-square-foot tower includes a 30-room emergency department, a 28-bed intensive care unit and a rooftop helipad for easier access to the ER.

Jyric Sims, CEO of Medical City Fort Worth, described the project as “a labor of love” that brings advanced technology to its emergency room. The expansion includes six pediatric care rooms, two trauma rooms and one room equipped for behavioral health patients.

The new tower, under construction since May 2017, will be connected by a skywalk over 9th Avenue to the hospital’s old building, which will remain open for other patient services such as surgeries and cancer treatments. The hospital is licensed for 320 beds.

Founded in 1976 as Medical Plaza Hospital, the hospital is part of Medical City Healthcare, one of the region’s largest health care providers. It operates 14 hospitals, seven off-campus emergency rooms and more than 50 ambulatory sites across Dallas-Fort Worth.

Medical City‘s parent company is Nashville-based HCA Healthcare, which ranked 63rd in this year’s Fortune 500 with annual revenue of $47.6 billion.


Source: Dallas News