Every industry has felt the brunt of COVID-19 restrictions and the ensuing economic downturn of 2020. Physician practices are not exempt from feeling this struggle. According to a 2020 survey by the Physician’s Foundation indicates that nearly eight percent of those surveyed closed their medical practice due to the pandemic. Extrapolating that data to the nearly 200,000 physician practices in the US, that means we may have lost approximately 16,000 practices nationwide. Health systems seem to be one of the largest closures of outlying clinics. With diagnostics, routine care and elective procedures shrinking, some have chosen to close those practices, leaving building assets ripe for investors to make a move.
Even with limited transaction volumes in the medical office building space, pricing continues to hold steady and provide a safe haven for investors at this time. “Monetizing real estate if often a favorable way to bolster cash positions at attractive yields,” according to the HSC report. “Health Systems considering medical office building sales can potentially utilize the capital raised through asset sale toward new acquisitions, repayment of debt, or as a cash buffer to protect against future financial uncertainty.”
For more detailed information on the state of medical office buildings and the HSC report, please visit: https://www.globest.com/2020/11/17/investors-view-medical-office-buildings-as-safe-haven-assets/
UES Consulting Services, Inc. is a nation-wide environmental consulting firm, providing Phase I ESAs, Phase II subsurface investigations and remediation, along with Property Conditions Assessments (PCAs).