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. Despite all of these headwinds, project starts have remained remarkably stable, suggesting the pandemic has largely been causing project delays after breaking ground. This certainly plays out in construction duration stats. Average time under construction for MOB projects that started between 2015-2019 was 455 days. Based on anticipated open dates for projects currently in progress, that average is 587 days. This will likely mean some time in the next year we will see a significant (and potentially prolonged) boost in deliveries as these projects finally open. Stay tuned to follow this and other developing trends!
