Healthcare Related Commercial Real Estate

by Commercial Real Estate

Health Care Industry Real EstateCommercial Real Estate and Healthcare Industry

After the collapse of the real estate and financial market of last decade, the new REITs concentrated on the acquisition of healthcare-related commercial real estate instead of piling up the residential real estate portfolios of the real estate boom era.  As the residential real estate market plummeted to a historic low during the recession of the past decade, the commercial real estates also witnessed their fair share of the slump.  Eventually, the ripple effects of the crash of the banking system and the real estate transferred to the retail industries.  This resulted in the closing of many stores, malls and shopping centers due to the high vacancy rates of the past decade.  The slumping Commercial Real Estate market did not end in the retail industry and spread through other segments of commercial real estate such as hotels and office buildings.
As the baby boomers reached the rate of 10,000 retirees per day, a considerable demand for healthcare entered the market that resulted in short supplies of such properties.  For that reason, there was a noticeable increase in demand for the healthcare facilities, making the hot commodities while most other commercial real estate properties collapsing into the darkness of the recession.  The demand for the purchase of healthcare-related properties, from active adult communities that offer onsite healthcare to Medical Office Buildings (MOB), Nursing Homes and Extended Stay Facilities, reached an all-time high and predicted to continue on this path for upcoming years.  While the residential real estate investments for the Pre-construction Investment Clubs, Real Estate Investment Trusts (REIT) became a thing of the past, the new REITs were burn that is predominantly specializing in the healthcare sector.  The latest acquisition of five MOBs by the REIT managed by Grubb and Ellis Healthcare REIT II for $44 Million is an example of what is up with the healthcare-related real estate industry.

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