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Home / Construction/Development / By This Measure There is Not Enough MOB Construction…

By This Measure There is Not Enough MOB Construction…

December 18, 2016 by Mike Hargrave Topics: Construction/Development, Leasing/Property Management, Policy/Legislation, Revista Best Practices, Revista News

Health care real estate investors, developers and stakeholders use a variety of metrics to measure market density for medical office buildings.  One measure, the amount of MOB square feet per insured population is showing significant change due the ACA.  Using Census data, we can determine the number of insured population in the US with any health insurance for 2013, 2014 and 2015.  We can then compare these numbers with the amount of medical office square feet in the US (using Revista data).  The numbers are below and are telling.

In 2013, there were 271.6 million insured and 1.3B square feet of MOB space in the US.  This means there was 4.82 square feet of medical office space in the US per insured resident (MOB SF/Insured).  In 2014, the number of insured grew by 2.2% to 283.2M while the amount of MOB SF grew by 1.1% to 1318.9M SF.  This resulted in a gap of 45.4M square feet of MOB space if 2013 penetration per insured had been held constant. In 2015, the gap grew to 63.0M SF. In all, from 2013 to 2015, the number of insured has grown by 6.7%  while the MOB stock as grown by just 1.9%.  This has caused the MOB SF/Population metric to decline by 4.5%.

2013 2014 2015
Number of Insured (millions) 271.6 283.2 289.9
MOB SF (millions of SF) 1,308.4 1,318.9 1,333.5
MOB SF/Insured 4.82 4.66 4.60
Required SF (to keep pace with 2013 penetration) 1,308.4 1,364.3 1,396.5
Gap (SF, millions; based on 2013 penetration) 0.0 45.4 63.0
Source: US Census Bureau 2015 Health Insurance, Revista Research; Numbers in millions

 

 

Mike Hargrave
Mike Hargrave

Other Articles by Mike Hargrave:

    • HCRE Construction Spending Peaks in 2023
    • TTM MOB Cap Rate Trends Showing a 20-30 Basis Points (bps) Sequential Rise
    • Lenders to the Medical Office Sector Signaling Caution, Lower Volumes

Previous Post:REITs Expanding Ownership in MOBs
Next Post:MRE Executives on the Move

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