Healthcare reform, ambulatory strategies and the rise of public REITs are three of the top 10 healthcare real estate stories of the past 10 years.
MINNETONKA, Minn. (PRWEB) February 06, 2013
Perhaps not surprisingly, healthcare reform topped the list of the 10 biggest stories affecting the healthcare real estate sector during the past 10 years. But some of the other stories to make the top 10 might surprise you.
Healthcare Real Estate Insights™ magazine celebrates its 10th anniversary in 2013 and the most recent edition spotlights the 10 topics and trends that the editors of HREI™ agreed have had the biggest impact on the sector since 2003. Here’s the list:
1. Healthcare reform changed everything. “For its all-encompassing, revolutionary impact on the healthcare industry and healthcare real estate, healthcare reform is the top story of the past decade,” HREI™ Editor John B. Mugford says. “Reform is transforming the healthcare industry, and that is transforming healthcare real estate.”
2. Ambulatory strategies have expanded. The steady transition to delivering more healthcare in an outpatient setting has continued – and is accelerating.
3. REITs have been on the rise. Healthcare real estate investment trusts have become a dominant force in the sector, accounting for 40 percent of medical office building (MOB) acquisitions in 2012, according to research firm Real Capital Analytics Inc.
4. Capital markets set the tone. “Capital is always key, but the wild ride of the capital markets during the past 10 years makes it a top story,” Mr. Mugford says.
5. Consolidation has changed the business. Both healthcare providers and healthcare real estate firms have acquired, merged, partnered and affiliated at an increasing rate.
6. Development boomed, busted and is bouncing back. After the peak of 2009 and the valley of 2011, the development of new medical office buildings (MOBs) and other healthcare facilities is again on the upswing. “The pace of development is still far less than during the go-go years of 2007-09,” Mr. Mugford says. But there was probably about 8.5 million square feet of MOB development in 2012, according to real estate firm Marcus & Millichap.
7. Repurposing is on the rise. Long derided as too expensive, the adaptive reuse of low-cost retail and office space now makes economic sense for expanding healthcare providers. “It also offers speed-to-market advantages,” Mr. Mugford says.
8. Monetizations haven’t happened as often as expected. The sale of non-core assets such as MOBs by healthcare providers was a hot topic in the mid-2000s, Mr. Mugford says, “But it has not expanded as quickly as many expected."
9. MOB sales have soared. Although there have been relatively few hospital-driven MOB sales in recent years, others – particularly private developers and investors – have been actively selling. Final data is not yet available, but 2012 was shaping up to be perhaps the biggest year ever for MOB sales in terms of total dollar volume, RCA says.
10. The sector is still growing. “The same factors that made healthcare real estate a good business to be in back in 2003 make it a good business to be in today,” Mr. Mugford says, “plus healthcare reform is likely to drive even more development, financing and investment activity.
For more information on the top 10 healthcare real estate topics and trends of the past 10 years, or to subscribe to Healthcare Real Estate Insights™, please visit us at http://www.HREInsights.com. Qualified members of the news media are invited to request a complete copy of the most recent edition of HREI™ by emailing the publisher at Publisher(at)HREInsights(dot)com.
About Healthcare Real Estate Insights™
Launched in January 2003, Healthcare Real Estate Insights™ has come to be recognized as the most trusted independent source of news and trend information in the healthcare real estate development, financing and investment sector. This monthly, national, B2B magazine offers sophisticated industry professionals the most comprehensive coverage of the business available anywhere. For more information or to subscribe, please visit us at http://www.HREInsights.com.
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