MOB Construction Starts Strong Despite Rising Costs
We\’ve all been hearing about the significant uptick in materials and labor costs associated with construction over the last number of months, particularly lumber which has been the focus of …
Leasing/Property Management
MOB Fundamentals Holding Steady Through the Pandemic
The Medical Office Building (MOB) sector has shown its mettle through previous economic challenges. But with the onset of the Covid-19 pandemic and ensuing slowdown of elective surgeries and office …
MOB Fundamentals Remain Steady
Development and acquisition activity is currently suppressed in the medical office sector. However, this does not reflect a wavering in the underlying performance of medical assets. The graph below is from our 3Q23 Industry Fundamentals Report, which tracks a group of large medical office portfolios containing approximately 150 million square feet. It shows the average NOI per occupied square foot, which has continued to tick up, now at a level of $23.20.
MOB Occupancy at Cyclical High Point while Office Continues Struggle
The office market continues to struggle with the volume of employees working from home or on a hybrid schedule coming out of the pandemic. Although historically viewed as a subsector of office, the dynamics of the users of medical office space are completely different.
MOB Occupancy Trends Across the Country
If we take a look at the overall occupancy trends for the top 50 metros, we can see that a shallow U-shape has formed over the past few years. While this pattern shows a modest dip followed by a recovery, this may not be the story for individual metros.
MOB Project Delays Temper Deliveries, Starts Steady
MOB project completions continue to slow in 2Q, down to 17 million square feet in annual deliveries. This is the lowest pace of deliveries in the last 6 years and represents a 32% decrease from the annual run rate of 25.1 million SF in deliveries in 1Q2020- just before the onset of COVID and all the related shutdowns, restrictions and labor shortages.
MOB Rent Growth Acceleration Slows in 2Q
Historically, Medical Office Building year-over-year rent growth has been right around the 2% mark. During the pandemic shutdowns there was a meaningful slowdown, but it rebounded shortly after as businesses …
MOB Rents by Region
Which regions have the highest rents? According to the following graph, which covers the largest metro areas across the U.S., the Pacific region is the outlier. In 2Q24, the Pacific had asking rents 29% higher . . .
MOB Tenant Retention Rates Set Recent Highs in 4Q19
Industry participants often point to the “stickiness” of medical office leases. This stickiness is measured in tenant retention rates. Generally, over the past 11 years, average MOB retention rates have …
MOB Transaction Volume Continues to Cool, Private Investors Still Lead Acquirers
2019 MOB deal volume continues the cooling trend after coming off historical highs in 2017. Preliminary data shows 375 MOBs traded in the first half of 2019 representing about $4.4 …
MOBs Can Weather a Storm
In recent weeks we’ve seen significant volatility in the stock market along with increasing fears of a recession. After all, this is now the longest market expansion in history. It …
MOBs Located on a Hospital Campus vs. MOBs Close to a Hospital Campus. Is there a Difference?
Historically, Revista has categorized medical office buildings (MOBs) into two categories, on a hospital campus or off. However, recently Revista has developed a third category, adjacent. These are the properties that fall within a quarter mile of a hospital campus footprint. Conventional thought suggests that on-campus assets demand a premium, but what about the buildings just outside of a campus?
New Hospital Construction Picks Up
The construction pipeline of new and replacement hospital projects has been steadily increasing over the past two years. As of the second quarter, 45 million square feet of new hospital …
North Shore LIJ and Waterstone Development Group Team to Buy Manhasset, NY MOB
In an interesting transaction, North Shore LIJ Health System of Great Neck, NY teamed up with Waterstone Development Group to purchase 600 Community Drive in Manhasset, NY. According to a …
Occupancy in Outpatient Medical Rides High in “Tertiary” Real Estate Markets
Long-time owners of healthcare properties have recognized this phenomenon for a while – tertiary markets offer high occupancy and high probability of renewal – contrary to conventional investment wisdom in . . .
Off Campus MOBs Catching up to On Campus MOBs in the Top 50 Metros
Did you know that Revista tracks both On and Off Campus medical office buildings (MOBs)? And starting in 2025 we will also track adjacent to campus MOBs. On and Off Campus MOBs have different operating characteristics particularly regarding ground leases and . . .
Outpatient Employment Rebounds in May
Many economic signals rebounded in May of 2020. The equities markets, housing markets and overall employment markets all showed sharp pullbacks in March and April only to rebound sharply in …
Outpatient Real Estate Sector Riding a Wave of Strength!
he outpatient real estate sector is large and diverse. The terms Medical Office Building (MOB) or Medical Outpatient Building (also MOB) are often used to describe the main property types in the outpatient sector. In all, the MOB sector comprises over 1.6 billion square feet (SF) across . . .