Exclusive new report now available from Revista finds that hospital projects led the way, but predicts that MOBs will dominate in 2016. Firm also announces two new advisory board members and upcoming events.
ANNAPOLIS, Md., Feb. 25, 2016 – U.S. medical real estate construction totaled more than $97 billion in 2015, according to an exclusive new report now available only from Revista.
The Annapolis-based healthcare real estate (HRE) data firm also announced that it has two new board members and that it has set the dates for an upcoming webinar and its 2016 Medical Real Estate Investment Forum.
Hospital construction dominated in 2015, but MOBs will lead the way in 2016
“In 2015, hospital completions dwarfed medical office building (MOB) completions, but expect that trend to be reversed in 2016,” says Mike Hargrave, one of Revista’s founding principals.
“Last year, 258 hospitals totaling 30.7 million square feet were completed, compared with 240 MOBs totaling 12.9 million square feet. But, based on what’s in the pipeline, Revista projects that 387 MOBs totaling 23.9 million square feet will be completed this year, versus 251 hospitals totaling 19.9 million square feet.
“We are seeing a growing shift toward delivering care in an outpatient setting, and our 2016 projections, especially off-campus MOB completions, appear to reflect that trend,” Mr. Hargrave explains. According to the report, 287 off campus MOBs are expected to complete in 2016 versus 170 in 2015.
Available exclusively from Revista, the “2015 Year End Medical Real Estate Construction Report” includes data on hospital and MOB projects including new construction, expansions, and replacements of existing properties. Revista captured data for well-defined, approved and funded projects in excess of $5 million in value, greater than 7,500 square feet and with verified construction start dates.
The Revista “2015 Year End Medical Real Estate Construction Report” also found:
- In 2015, the 258 hospitals that were completed represented a total value of $19.5 billion. On the MOB side, the 240 projects that were completed had a total value of $5.3 billion.
- The total pipeline for hospital construction shows the New York Metro (New York City and Newark and Jersey City, N.J.) and the Houston Metro near the top with each having 22 hospital projects underway. On the MOB side, the New York Metro had 24 projects under construction, followed by the Los Angeles Metro with 20.
- California, the most populous state, had the highest total construction value for the hospital and MOB pipeline, at $16.4 billion, as well as the highest construction value of hospital and MOB openings in 2016 at $4.2 billion.
Total Pipeline – Data as of 12/31/15
| Hospital | Medical Office Building | Grand Total | |
| Number of Properties Under Construction | 691 | 579 | 1,270 |
| Total Square Feet Under Construction | 94.7M | 43.2M | 137.9M |
| Construction vs. Inventory | 6.20% | 3.30% | 4.80% |
| Total Value | $78.0B | $19.1B | $97.1B |
| Median Square Feet/Project | 58.5K | 50.0K | 50.0K |
| Median Construction Value/Project | $37.0M | $15.0M | $23.5M |
Top Ten States Ranked by Total Square Feet Under Construction (UC)
| State | # Properties UC | Total SF UC | Const. v Inventory | Total Value |
| California | 116 | 13,610K | 5.70% | $16,407M |
| Texas | 109 | 12,836K | 5.50% | $9,042M |
| Florida | 92 | 8,841K | 5.10% | $5,843M |
| New York | 66 | 8,114K | 5.20% | $7,269M |
| Pennsylvania | 49 | 7,931K | 6.40% | $3,753M |
| Illinois | 61 | 7,323K | 6.40% | $4,945M |
| Michigan | 48 | 6,052K | 6.80% | $3,285M |
| Ohio | 49 | 5,226K | 5.10% | $3,026M |
| Colorado | 38 | 3,692K | 8.00% | $2,472M |
| Virginia | 36 | 3,079K | 4.90% | $1,430M |
To access the full 2015 “Medical Real Estate Construction Report,” please visit http://www.revistamed.com/pages/reports.
New advisory board members join Revista
Revista also announced two new advisory board members: Kevin M. Kirn (left) and Scott Selig (right).
Mr. Kirn serves as Vice President, Business Development of Welltower Inc. (formerly Healthcare REIT.) He assists in the development and execution of the Outpatient Medical Group’s investment strategy. He is also responsible for sourcing and managing strategic relationships with leading healthcare providers, physician groups, academic medical centers, developers and brokers throughout the investment process.
Scott Selig, became Associate Vice President of Capital Assets and Real Estate at Duke University in 2001. Scott’s professional career includes over 30 years of experience in many facets of the commercial real estate industry including brokerage, property management and development. Scott is charged with developing and implementing the overall real estate strategy for Duke University and the Duke University Health System, the asset management of the Washington Duke Inn, and the acquisition and disposition of Duke Forest land. For more information on Revista’s full advisory board, please visit http://www.revistamed.com/Advisory-board.
Upcoming events Revista also announced two upcoming events. A webinar, “The Outlook for the Medical Real Estate Sector,” is scheduled to be webcast Wednesday, March 9, and the 2016 Revista Medical Real Estate Investment Forum is scheduled for Oct. 4-5 at the Omni Interlocken Resort & Golf Club in Broomfield, Colo. (8 miles from downtown Boulder). For more information on Revista’s events, please visit RevistaMed.com/Events.
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