• .
    .

Thought Leaders: 2021 Medical Office Property Sales at Unprecedented Level

Medical office sales volume totaled $19.6 billion in 2021 — demonstrative evidence of the acceleration in investor appetite during the global pandemic for this stable, income-producing real estate investment class.

JLL Healthcare Capital Markets

February 2022

JLL Research reports medical office sales totaled nearly $20 billion in 2021, reaching an all-time high.

Total Medical Office Investment Sales at Record Level in 2021

Source: JLL Research, Real Capital Analytics (transactions larger than $2.5 million)

  • Medical office sales volume totaled $19.6 billion in 2021 – demonstrative evidence of the acceleration in investor appetite during the global pandemic for this stable, income-producing real estate investment class. Sales activity grew 40.1% from 2020, a dramatic jump from the last four years’ sales range of $13 to $14 billion. The increase was pronounced in single asset transfers, closing the year at $11.8 billion in volume, up 34.6% from 2020 and exceeding total sales volume that occurred in all years before 2016.
  • Portfolio sales hit record levels as well with $7.7 billion of trades, representing nearly 40 percent of total medical office sales. The prior portfolio record of $6.1 billion in 2017 included the notable $2.7 billion Duke Realty Healthcare sale. Noteworthy about portfolios in 2021 was the scale of offerings with 10 portfolios larger than $250 million and five larger than $500 million. The scale was responsive to new entrants and others looking to deploy substantial equity of $100 million or greater in a single transaction.
  • Expectations are high that this new level of medical office sales will persist. In the first two months of 2022, five portfolios traded with a total value of $2.8 billion, more than one-third of 2021 portfolio volume. The announcement on February 28 of the $12 billion combination of Healthcare Realty Trust and Healthcare Trust of America, the two largest MOB-only REITs, reinforces the strength of conviction around the medical office property class.
  • Investors are increasingly drawn to the defensive nature of MOBs due to its steady performance relative to other institutional property classes given that medical office properties barely missed a beat during the turmoil of the last two years. Investors are excited by factors driving reliable demand for healthcare services with the growing and aging U.S. population. With scale of investment and continued demonstration of stable performance, the sector is becoming more institutional and providing increased liquidity as the asset class grows in maturity. With new funds and capital entering the MOB space, competing for limited opportunities, the sector is on track to see a steady rise in transaction activity, increasingly driving strong property values.

JLL is proud to be a Platinum sponsor of the 2022 Revista Medical Real Estate Investment Forum Conference held March 2 – 4, 2022 at the Loews Coronado Bay Resort, Coronado, CA

Want to receive more deal opportunities? Register for the JLL Investor Center, our new portal offering secure and easy access to our global inventory of investment opportunities.

From any device, anywhere in the world, you can search and view listings, receive invitations to private listings, and edit your preferences so you only receive opportunities that meet your specific criteria. Register for the Investor Center here>

Contact us:

Our national team

View past newsletters

Learn more

Contact us

The full content of this article is only available to paid subscribers. If you are an active subscriber, please log in. To subscribe, please click here: SUBSCRIBE

Existing Users Log In