Medical office properties still a good investment

In recent times, commercial office building managers have faced serious challenges brought by the recession. Despite these pressures, medical office buildings continue to perform better than the market, industry experts say. In fact, medical office buildings are a critical asset for some hospitals, who can still sell the buildings at a reasonable price to generate much-needed capital.

Unlike commercial buildings, medical office building prices have remained relatively stable--a good thing in a market where prices have fallen substantially. Another reason buyers like medical office investments is that physician tenants tend to take long leases, which makes it far more likely that building owners can anticipate steady cash flow. (Of course, physicians with good credit are especially attractive.)

Still another benefit to medical office buildings is that the health sector is less prone to fluctuations when the economy goes sour, investors stay. And even better, with procedures moving to the outpatient setting, medical offices are an even more stable bet.

It's true that sales of medical buildings dropped 20 percent in 2008, but sales of other types of commercial real estate fell 51 percent during the same period. All this suggests that while medical buildings are far from a fool-proof investment, they still seem to offer benefits for everyone in the picture.

To learn more about this story:
- read this American Medical News piece

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