Overall population growth might matter more than growth in the 65+ segment
By John B. Mugford
When it comes to MOB space absorption, a recent Revista analysis suggests that overall population growth has been a more important factor than 65-plus population growth. (Slide courtesy of Revista)
Healthcare real estate (HRE) investors and developers are talking a lot these days about the advantages and payoffs associated with looking for and finding opportunities in “growth markets.”
As Hilda Martin, a principal with Arnold, Md.-based Revista and its RevistaMed service, which is focused on a wide array of HRE data, heard this numerous times from people involved in medical facility investing and development, she decided to take a closer look at what’s going on in the country’s most dynamic geographic areas.
And what she found is that there is certainly a lot more development taking place in what can be considered growth markets as opposed to markets that have lost population since the shutdowns of the COVID-19 pandemic. This is the case even though the growth markets tend to have relatively smaller populations than the markets that have lost people.
Ms. Martin presented her newly compiled data during RevistaMed’s recent second quarter (Q2) subscriber webcast in late July. The webcast was highlighted by a report from Stephen Lindsey, a research analyst with the firm, indicating that the medical outpatient building (MOB) sales volume – at least through the first half of 2024 – was not yet picking up steam from a nearly two-year slump. The Q2 sales volume was $1.9 billion, tying for the fourth-lowest quarterly total since the start of 2016.
The webcast, however, presented a wide array of data substantiating the notion that the HRE sector remains a strong place to be for owners of such facilities, as occupancies in the nation’s top 50 markets
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