{"id":1004703560,"date":"2024-02-26T04:36:57","date_gmt":"2024-02-26T12:36:57","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004703560"},"modified":"2024-02-28T01:03:39","modified_gmt":"2024-02-28T09:03:39","slug":"medical-office-to-perform-well-in-2024-report","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/medical-office-to-perform-well-in-2024-report\/","title":{"rendered":"Medical Office to Perform Well in 2024: Report"},"content":{"rendered":"\n

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Erik Hill of Partner Valuation Advisors pointed out that several secular trends and recent market conditions are making health-care real estate appealing to long-term investors.
Image courtesy of Partner Valuation Advisors<\/em> <\/figcaption><\/figure><\/div>\n\n\n

Despite facing similar challenges to other CRE sectors, resulting in declining transactional and lending volumes in 2023, medical office\u2014and the health-care industry at large\u2014continues to perform well overall, according to a recent study from Partner Valuation Advisors<\/a>.<\/p>\n\n\n\n

For one thing, occupancy remains attractively high compared to other classes, and an aging U.S. population creates ample demand for health-care services. And while interest rates are expected to remain elevated this year, the report states, \u201cThe lack of new supply and favorable demographic trends offer an attractive investment environment for health-care investors.\u201d<\/p>\n\n\n\n

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READ ALSO:<\/strong> MOB Sector Remains Stable, Attractive<\/a><\/p>\n\n\n\n

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As fundamentals in the sector remain strong, the need for MOBs and other health-care properties continues to increase, said Erik Hill, PVA national practice leader of health-care and life science, in prepared remarks. He also emphasized that the sector maintained good occupancy and steady rent growth over the past decade, also mentioning high tenant retention rates and limited supply as incentives for long-term investors. <\/p>\n\n\n\n

However, the sector did not remain unscathed: Due to increased capital costs and rising cap rates, most respondents believe the value of health-care properties has declined by 10 to 20 percent over the past 12 months.<\/p>\n\n\n\n

The survey involved leaders across the industry, including lenders, investors, developers and investment sales professionals.<\/p>\n\n\n\n

Medical office in focus<\/h2>\n\n\n\n

The survey report highlights several prominent points on MOBs:<\/p>\n\n\n\n