New medical office with major tenants trades at premium
Over the past year, new medical office buildings with major tenants changed hands for an average of just under $270 per square foot, well above the $192 per square foot average for U.S. medical office as a whole, according to Marcus & Millichap. The buildings traded on a premium to the greater office market as well, which moved at $245 per square foot sectorwide during third quarter 2014, though location is still the biggest factor as CBD office, regardless of subsector, traded at $351 per square foot during the third quarter, according to Real Capital Analytics.
The growth in the pricing of newer medical office buildings can be attributed to changing dynamics in the healthcare industry as most major healthcare providers have been putting extra emphasis on aesthetics and visibility, taking advantage of the marketing and branding that comes with high-quality real estate.
Property owners who have been paying the premium for newer medical office with major te