Although first-half market reports from two of the larger commercial real estate services firms heavily involved in healthcare real estate might not provide absolute answers, they do include some interesting data about the sector and, perhaps, where it’s headed.
The types of projects that will be supported include orthopedic centers, medical outpatient buildings, and inpatient rehabilitation facilities that will be developed across five undisclosed states.
Although 2022 was generally considered to be a tough year for healthcare real estate developers – the result of rising construction costs and inflation – the amount of medical outpatient building space started or completed fell only 1.1 percent from the previous year.
That was indeed a bit of a surprise last year when the Arnold, Md.-based research firm Revista issued its 2023 Outpatient Real Estate Development Report, which indicated that the volume of MOB projects started or completed in 2022 totaled 44.9 million square feet in 2022, down slightly from the 45.4 million square feet of space started or completed in 2021.
However, it looks as if increasing costs, rising interest rates, harder-to-obtain debt and financially challenged health systems caught up with the MOB development business in 2023.
The newly released 2024 Outpatient Real Estate Development Report provides a wealth of information on medical office and other outpatient properties started and completed in 2023 by third party developers. The report provides a ranking of total number of projects, total square feet and total construction value for the top developers.
Source: HREI
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