The average cap rate for medical office building (MOB) transactions moved up to 7% in the last quarter of 2023. This is up 90 basis points from one year prior. A pricing gap between on and off campus MOBs remains, with on campus coming in 30 basis points lower at 6.7%. Despite the strong underlying fundamentals, investor demand is being limited by stringent capital conditions. Pricing has become less competitive on a price per square foot basis as well, down to $346 a square foot.
If you’re interested in understanding how the different industry participants view the current environment, make sure to come to our conference next week in Pasadena, CA. Several sessions will discuss the current capital conditions and you will hear the perspectives of capital providers, brokers, health systems, REITs, developers, economists, and more. Information on the sessions and registration can be found here: Session Information
