An Inside Look At The Healthcare Real Estate Industry
South Florida Hospital News | By: Lois Thomson
To a greater extent than ever before, the healthcare industry seems to be closely linked to the real estate industry, and nowhere more so than in South Florida. South Florida Hospital News recently talked with four major leaders who are involved in the healthcare aspect of realty, and learned their thoughts on trends, changes and challenges in this hot topic area. Kenneth Weston, President of Kenneth Weston & Associates, Inc. a medical real estate broker, developer and consultant, has specialized in healthcare real estate since 1978. The firms' services include physician and healthcare facility representation, project analysis and consulting, project marketing, commercial condominium development and conversions and fee development.
All four have a well established presence in South Florida and beyond. In many cases their answers to the question are similar, which isn't surprising, considering that all are familiar with the industry and the market.
Is healthcare real estate currently experiencing a boom, and if so, do you expect it to continue?
KW - One of the two points that has caused healthcare real estate to change over the past decade is the emergence of outpatient facilities. Procedures that were typically done on campus are now being done outside of the hospital setting, in the walk-in health care centers. The other (change) is the emergence and growth of medical office condominiums.
But what you're finding now is the emergence of situations where physicians have the option to purchase their own office space as opposed to leasing space, and that's taken place because of several issues. Over the past five years the stock market has been somewhat unstable, so physicians were looking for ways to diversify their income portfolio. Because of the high cost of their tenant improvement allowances relating specifically to plumbing, cabinetry, etc., those improvements go with the space once (the physicians) retire or sell the practice.