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Medical office sector maintains high demand as other commercial real estate sectors struggle

Health care real estate is viewed as a stable asset among investors

Despite commercial real estate challenges that started during the pandemic, the medical office sector remains one of the most resilient and a favorite for investors, according to JLL’s Healthcare and Medical Office Perspective report.

Absorption has outpaced new supply and occupancy has remained consistently high above 90% for twenty years, aided now by construction delays during the outset of the pandemic and resulting in a fall in completions amid steady demand for medical office, according to the report. Medical office occupancy is relatively stronger than the commercial office sector and was significantly less disrupted by pandemic, with medical office asking rents averaging 2% growth year over year for the past five years and reaching an average $23 per square foot triple net by mid-year 2022.

Medical Economics

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