With the cost of construction materials continuing to rise, and interest rate hikes on the horizon, how will new MOB developments be affected? As the second quarter of 2022 is coming to a close, MOB construction starts have held relatively steady with over 20 million SF having been started in the past year. This high number is still being held up by the strong finish in 2021, but with over 4 million SF started in this quarter, growth remains solid.
Let’s now take a look at our largest markets. Together, these markets have started 9.53 million SF of construction in the past year. We can see that Miami and St. Louis both have construction starts over 4% of their current inventory. New York and Houston are leading on a SF foot basis, with both clearing 1.2 million SF. As the year goes on, we will continue to monitor how the market is reacting to the unique economic conditions resulting from the pandemic.