In a recent interview, the CEO & president of a construction management and general contracting company that specializes in health-care explains why construction is trending toward smaller outpatient care facilities and clinics and discusses the challenges within the sector.
The prospect of leasing to health systems is especially attractive to office and retail owners that experienced rising vacancy during the pandemic. While landlords are expressing more interest, it is often difficult to convert the space into medical use.
With better growth opportunities, investors turned towards the medical office sector. Now pricing is at a premium relative to suburban offices, according to a recent analysis.
With the aging population increasing from 17% of the U.S. population in 2020 to 21% of the U.S. population in 2030, medical encounters will be on a rapid rise. Outpatient encounters are expected to top more than 3.2 billion serving the expected U.S. population of 355 million individuals in 2030, or 9 visits per individual a year.
While life sciences has been the notable winner in commercial real estate throughout the pandemic, it’s possible we still haven’t scratched the surface of how strong the sector will become according to recent report findings.