2023 Medical Office Fundamentals Outlook

BOCA RATON, Fla., June 20 – HealthCare Appraisers, a leading healthcare valuation and advisory firm with offices nationwide, has released its latest publication, the 2023 Medical Office Fundamentals Outlook. This report explores and illustrates timely real estate-related topics for medical office buildings (MOBs), including rental rates, development trends, preferred product type, and pricing. A complimentary download is available at: https://healthcareappraisers.com/2023-medical-office-fundamentals-outlook/

This publication is the product of discussions with numerous lenders, real estate brokers, investment bankers, and various other medical office entities, on subjects such as industry drivers, financial markets, capitalization rates, internal rates of return, as well as current trends and overall market conditions.

“Inflation entered the markets like a lamb during 2021, with most pundits viewing it as “transitory.” However, monthly inflation numbers climbed steadily in Q1 and Q2 2022, then came out roaring in Q3 and Q4 2022. This prompted the Fed to take an aggressive posture to rein in inflation…with the fastest increase in interest rates in modern history,” said Jeff Piehl, MAI, Partner at HealthCare Appraisers, Real Estate Team Lead, and author of the publication. “As telegraphed, the higher interest rates and subsequent higher lending costs led to lower pricing levels, and transaction volume trickled to a halt. In less than six months, a majority of investors and lenders were “pencils down” on new deals. “We cover this and more in this year’s report, including the onset of inflation in 2022, what to expect for 2023 and beyond, healthcare real estate investment trusts (REITS), leasing activity, and results of our MOB Survey,” said Piehl.

HealthCare Appraisers is actively involved in the medical office investment market from both the health system side as well as investor side, and is actively fluent in investor pricing requirements, lender underwriting criteria, investment broker relationships, and intricacies of sales transactions.

HealthCare Appraisers is a premier healthcare valuation and consulting services firm recognized for its thought leadership and proven track record. We are 100% employee owned as an Employee Stock Ownership Plan (ESOP) company. This ownership structure motivates unmatched client service and innovation. Experience how we think differently.