The preliminary 1Q25 numbers are in, and they show that transaction volume has been slow to kick off the year. $1.5 billion worth of MOBs traded in the 1st quarter, and $8.9 billion traded over the past year. This suppressed level of activity is closer to what was recorded in 2023, in comparison to the uptick seen in 2024. 2023 averaged around $2 billion a quarter, then 2024 activity got noticeably higher, averaging about $2.5 billion a quarter if you ignore the Healthpeak/DOC merger in the first quarter. An explanation for some of the hesitancy to kick of the year is changing economic policy because of the new administration. Towards the back end of 2024, the uncertainty around the interest rate path and the trajectory of the economy was starting to fade and investor sentiment began to pick up. Rapid policy changes in 1Q25 reintroduced uncertainty and investors became less confident in the short-term outlook. There is still a lot of time left in 2025, so make sure to stay tuned to see how this plays out.
