The Healthcare Real Estate Shortage


Healthcare does not operate in a bubble. It intertwines itself with other industries not commonly mentioned, such as real estate. In this niche market, medical real estate refers to all the facilities that the healthcare community uses. That includes buildings and campuses that member and organization in public or private sector lease or buy. It also includes other facets within the system including a New York or Vancouver personal injury law firms that might own an office within a medical facility. There has however been a growing trend among this community to instead work with a third-party entity to manage the real estate side of the business to allow healthcare practitioners to focus solely on their profession and patients.

A niche market

Healthcare real estate is in a class of its own due to the regulations that govern the owning and operating. Aspects such as sterilization, heating, and cleaning are different in this field. Due to the already demanding nature of running a medical facility, heads prefer to leave running the space to organizations that profit from the business of providing space and services. The services included property management, tenant advisory, leasing, and construction. These third-party organizations find it lucrative as it is a growing industry.

Shortage of medical real estate

The primary cause for this growth is the increasing number of Baby Boomers now in need of medical attention due to age-related illnesses. Recent studies, however, show that there will in the coming year be a shortage of real estate to accommodate this rise in demand in the US market. That is according to the Medical Office Space Gets Tight report for 2019.

The other reason for the shortage is the increase of healthcare professionals joining the workforce. The report and other data put the number at 150, 000, in the next two years, all in need of office space. Though there are buildings under construction, the shortage falls at almost half if the trend continues. The proposed solution is the leasing of other spaces that typically aren’t for medical use and renovating them.

Technology is also considered to be an equally viable solution to quell demand. The rise of telemedicine and other variation frees up space taken by patients and medical professionals as they can work remotely. The trend is slow to catch as there are limitations, but an acceleration of the same would aid in reducing the medical real estate shortfall.


  1. Real estate investing can be profitable, but you shouldn’t jump into investing without doing your homework. Buying and financing properties is easier when you know what to expect, and when you can build a relationship with a knowledgeable mortgage officer and realtor.

Comments are closed.