{"id":1004813492,"date":"2026-10-01T12:25:17","date_gmt":"2026-10-01T20:25:17","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004813492"},"modified":"2026-10-01T12:25:19","modified_gmt":"2026-10-01T20:25:19","slug":"is-an-mob-makeover-the-right-remedy-for-your-space","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/is-an-mob-makeover-the-right-remedy-for-your-space\/","title":{"rendered":"Is an MOB Makeover the Right Remedy for Your Space?"},"content":{"rendered":"\n
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This article first appeared in the CPE Sneak Peek Newsletter. Subscribe now<\/a> for early access to exclusive content, in-depth analysis and key trends!<\/em><\/p>\n<\/blockquote>\n\n\n\n

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Image made in Adobe Firefly<\/em><\/figcaption><\/figure>\n\n\n\n

It\u2019s a tempting proposition. You manage an office, retail or another type of commercial property that\u2019s facing excess vacancy in the post-pandemic world. At the same time, new medical office construction is constrained while demand from an aging population is growing. Given these conditions, you might consider attracting medical tenants to your vacant space\u2014or even converting the entire property into a medical office building.<\/p>\n\n\n\n

At first glance, vacant commercial space and growing outpatient demand might look like a natural match. But successfully integrating medical space with traditional assets depends on several factors that might not be readily apparent. Taking stock of a building\u2019s infrastructure, location and long-term operating model is crucial to success.<\/p>\n\n\n\n

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READ THE MAGAZINE<\/strong><\/a><\/div>\n<\/div>\n\n\n\n
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\u201cThe key question is: \u2018What does your program need, and then what can the building do?\u2019\u201d Danei Wallen, a senior project manager at Group PMX, told Commercial Property Executive<\/em>.<\/p>\n\n\n\n

The opportunity<\/h2>\n\n\n
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Danei Wallen, senior project manager at Group PMX, emphasizes that successful medical adaptive reuse starts with understanding the intended program and what the existing building can support. <\/figcaption><\/figure><\/div>\n\n\n

MOBs are among the most stable asset classes in CRE, and for good reason. Well-known demographic trends, particularly the aging U.S. population, support demand for outpatient care. From 2023 to 2024, the 65-plus population increased 3.1 percent, according to U.S. Census Bureau data.<\/p>\n\n\n\n

Broader medical office real estate trends<\/a> point to a relatively constrained construction pipeline. <\/p>\n\n\n\n

Occupancy reached a record 92.7 percent at the end of 2025, while absorption has consistently outpaced deliveries, according to JLL research. MOB project starts stood at just 1.1 percent of existing inventory in the second half of 2025.<\/p>\n\n\n\n

While office occupancy has improved, the sector continues to face excess vacancy. The national vacancy rate stood at 17.7 percent as of July, according to a Yardi Matrix report<\/a>.<\/p>\n\n\n\n

To fill that vacancy, one option is attracting medical tenants. But not all medical offices are viable, observed Brandon Bardowsky, senior director for project & development services at Cushman & Wakefield.<\/p>\n\n\n\n

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It\u2019s what does your program need, and then what can the building do?<\/p>\n\u2014Danei Wallen, Senior Project Manager, Group PMX<\/cite><\/blockquote>\n\n\n\n

The providers most easily accommodated in traditional office environments tend to be lower-acuity outpatient practices, such as primary care, dental and physician offices where patients are primarily being examined rather than undergoing complex procedures. Such high-acuity uses as endoscopy, advanced imaging and surgery require substantially more specialized infrastructure.<\/p>\n\n\n\n

Though office properties get plenty of attention as candidates for conversion to other uses, it\u2019s worth noting that office isn\u2019t the only source of potential medical space. Wallen is currently overseeing the conversion of former retail space into clinical and teaching facilities and has previously worked on other health-care adaptive-reuse projects.<\/p>\n\n\n\n

A standout example is Inspira Health Center Deptford<\/a>, an outpatient facility that opened in 2024 in Deptford, N.J. Previously the site of a Dick\u2019s Sporting Goods store, the 80,000-square-foot facility is located across the street from Macerich\u2019s Deptford Mall and offers services ranging from primary care, OB-GYN and imaging to cardiac services. Inspira and Rendina Healthcare Real Estate teamed up on the $50 million project.<\/p>\n\n\n\n

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A former Dick\u2019s Sporting Goods store in Deptford, N.J., serves as an 80,000-square-foot, multidisciplinary medical office building.
Image courtesy of Inspira Health<\/em><\/figcaption><\/figure>\n\n\n\n

What can your building handle?<\/h2>\n\n\n\n

Medical practices often require additional infrastructure to support their work. If your building does not already provide that, your property may need potentially costly renovations to make the space suitable for medical tenants.<\/p>\n\n\n\n

One of the most obvious differentiators between MOBs and traditional commercial assets is plumbing. Many practices, especially dentist offices, require a sink in every room. Beyond the need for additional sinks, the increased building traffic can strain plumbing systems that weren\u2019t designed for it, according to Malika Peltier, a managing director at Rethink Healthcare Real Estate.<\/p>\n\n\n

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According to Brandon Bardowsky, senior director for project and development services at Cushman & Wakefield, said lower-acuity medical uses are generally easier to accommodate in conventional office space.<\/figcaption><\/figure><\/div>\n\n\n

\u201cThe number of bathrooms, the amount of flushing and what people flush down toilets\u2014I know it sounds like a small thing\u2014but it ruins building systems that weren\u2019t built to accommodate that type of traffic,\u201d Peltier said. On Wallen\u2019s current retail-to-medical project, for example, the existing water system could not adequately serve the upper clinical floors, requiring an additional booster pump.<\/p>\n\n\n\n

Electrical and mechanical capacity can pose similar hurdles. Higher-acuity uses may require greater power loads, emergency generation, upgraded HVAC systems or even medical-gas infrastructure, Bardowsky said.<\/p>\n\n\n\n

The structural capacity and floor loading of your building may also pose challenges. Certain types of medical equipment\u2014such as MRI or CT scanners\u2014can be extremely heavy, and not all buildings considered for conversion are equipped to handle that extra weight.<\/p>\n\n\n\n

To account for this, one option is locating tenants with heavy equipment on the ground floor. This also helps with accessibility, as patients with mobility issues won\u2019t have to ascend stairs or deal with crowded elevators to reach their doctor, Bardowsky noted.<\/p>\n\n\n\n

Determining whether the building can support the intended medical use requires more than a typical leasing walkthrough. Wallen recommends bringing structural, mechanical, electrical and plumbing engineers into the process before signing a lease, since important building conditions may remain hidden until demolition.<\/p>\n\n\n\n

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One consideration in attracting tenants to a converted MOB is that medical providers often prefer to be located in the same building as other practices in their network, as at Rethink Healthcare Real Estate\u2019s Medical Pavilion I in National Harbor, Md.
 Image courtesy of Rethink Healthcare Real Estate<\/em><\/figcaption><\/figure>\n\n\n\n

Disputes between owners and tenants often arise over whether work constitutes a base-building improvement or a tenant improvement. That\u2019s particularly true when the renovation process reveals deficiencies in an aging property. Wallen said that conducting technical due diligence early and clearly defining which parties are paying for which improvements, can reduce the risk of disputes.<\/p>\n\n\n\n

Those costs can also surprise owners accustomed to conventional commercial fit-outs. On Wallen\u2019s current project, an early cost estimate of roughly $175 per square foot fell far short of the project\u2019s requirements for medical construction. Health-care fit-outs can cost around $400 per square foot, she noted.<\/p>\n\n\n\n

Beyond regulatory and site constraints, renovation costs should also be compared to the cost of developing purpose-built medical space. For medical practices that call for structural, MEP and infrastructure upgrades, the costs of those options can begin to converge. When it comes to those more acute MOB uses, \u201cI would say the juice isn\u2019t worth the squeeze,\u201d said Bardowsky.<\/p>\n\n\n\n

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It\u2019s very case-by-case, but you have to do your due diligence to really get a sense of it.<\/p>\n\u2014Danei Wallen, Senior Project Manager, Group PMX<\/cite><\/blockquote>\n\n\n\n

In some cases, little of the original building beyond its shell is reusable. Rethink has undertaken conversions that required stripping buildings nearly to their shells, and owners should weigh that level of rehab against the costs and efficiency of ground-up development.<\/p>\n\n\n\n

\u201cWe have taken a building down to its studs and basically rebuilt it,\u201d Peltier noted. \u201cYou\u2019re almost building it from scratch. You\u2019re just saving a little bit by keeping the outer shell.\u201d<\/p>\n\n\n\n

Also on the checklist: code requirements tied to the type of care being provided. Bardowsky pointed to NFPA 99, the National Fire Protection Association\u2019s code governing specialized health-care systems such as medical gases and electrical infrastructure, and NFPA 101, which addresses fire protection, occupancy and safe egress.<\/p>\n\n\n\n

\"Medical\n\t\t\t\n\t\t\t\t\n\t\t\t<\/svg>\n\t\t<\/button>
More medical tenants are searching for newly built space, according to Peltier, such as Rethink Healthcare Real Estate\u2019s Medical Pavilion II in National Harbor, Md.
Image courtesy of Rethink Healthcare Real Estate<\/em><\/figcaption><\/figure>\n\n\n\n

The footprint factor<\/h2>\n\n\n\n

The site, as well as the building, should be considered in MOB adaptive reuse decisions. Parking is a key factor, especially for full-building conversions. The traffic going in and out of doctors\u2019 offices in a day is often higher than the number of people working in a conventional office building.<\/p>\n\n\n\n

Although local requirements and medical uses vary, a helpful rule of thumb is that MOBs commonly require one to two more parking spaces per 1,000 square feet than office properties. For example, Columbia, S.C., requires five spaces per 1,000 square feet for medical office vs. 3.3 spaces for general office. If you don\u2019t have the ability to add more parking, such rules may be an insurmountable barrier. As Bardowsky put it, \u201cParking is a major driver that can kill deals pretty quick.\u201d<\/p>\n\n\n

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Malika Peltier, managing director at Rethink Healthcare Real Estate, cautioned that medical tenants can place greater demands on both building systems and property management.<\/figcaption><\/figure><\/div>\n\n\n

Like parking, zoning can be a challenge. A municipality may permit conventional office use for a site but impose stricter rules on medical occupancy. While sub-acute practices can often fit into existing zoning, more intensive clinical uses can require different zoning.<\/p>\n\n\n\n

Beyond the construction and infrastructure factors at play, it\u2019s also important to consider the tenant experience when you\u2019re evaluating the potential for mixing traditional commercial space with medical space. According to Bardowsky, the preferable option when medical tenants and conventional office occupants share a building is to separate the two categories as much as you can. Separate entrances, signage and elevators for the medical offices can help keep all parties satisfied.<\/p>\n\n\n\n

The benefits of that approach cut both ways. Providers often find it preferable to be located in a dedicated medical setting. That way, different practices from the same network can refer patients to one another. By the same token, your commercial tenants may also favor separation from their medical neighbors. \u201cOffice tenants don\u2019t want to be next to a burgeoning primary care group, kids running around, sick people coming into the building to see their doctor,\u201d Peltier said.<\/p>\n\n\n\n

Medical tenants also expect property managers to understand health care-specific regulatory and compliance requirements. As Peltier noted, \u201cYou\u2019re not going to have that when you\u2019re an office property manager.\u201d<\/p>\n\n\n\n

From the initial feasibility study through construction and property management, medical adaptive reuse requires owners to evaluate far more than whether vacant space is available. Ultimately, each property presents its own equation.<\/p>\n\n\n\n

\u201cIt\u2019s very case-by-case, but you have to do your due diligence to really get a sense of it,\u201d Wallen said. \u201cAnd even then, you\u2019re not going to know everything.\u201d<\/p>\n\n\n\n

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Read the October 2026 issue of CPE.<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

There’s no one-size-fits-all strategy for conversion. Here’s what to know.<\/p>\n","protected":false},"author":3810,"featured_media":1004813517,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21782,1521,21754,21747,21749],"tags":[32799,53014,53015],"class_list":["post-1004813492","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-development","category-digital","category-medical-office","category-office","category-retail","tag-cushman-wakefield","tag-group-pmx","tag-rethink-healthcare-real-estate"],"acf":[],"yoast_head":"\nIs an MOB Makeover the Right Remedy for Your Space? - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/is-an-mob-makeover-the-right-remedy-for-your-space\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Is an MOB Makeover the Right Remedy for Your Space?\" \/>\n<meta property=\"og:description\" content=\"There's no one-size-fits-all strategy for conversion. 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