6 Trends Influencing Healthcare Real Estate in 2013

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The healthcare real estate market will see more medical buildings designed for higher-acuity care, new uses for freestanding emergency departments and more partnerships and monetizations in 2013, according to Duke Realty in Indianapolis, a real estate company with more that 22 years of experience in the healthcare industry.  

Healthcare reform, the recession and lower reimbursements have influenced healthcare real estate over the last few years and will continue to do so in 2013. Hospitals and health systems will see the following trends in the year ahead, according to Duke Realty.

1. Higher-acuity care will increasingly move to medical office buildings. Higher-acuity and/or non-acute medical office buildings cost less to build, operate and maintain than hospitals. This is an attractive option for hospitals looking to cut costs in the face of the Patient Protection and Affordable Care Act that requires them to invest in costly new systems and procedures and puts pressure on Medicare payments and private insurance.

2. Freestanding emergency departments will be used in new ways. These emergency departments have been owned and operated by hospitals for the most part and were often the first step toward a future hospital campus. While freestanding emergency departments are still popular, more hospitals are partnering with specialized, for-profit emergency department operators for freestanding emergency departments.  

3. Partnering will increase. Hospitals, health systems and physicians groups are more willing to partner with for-profit and non-profit companies as it allows them to broaden their range of services quickly and improve quality of care. New, expanded or renovated facilities might be needed to accommodate these partnerships.

4. The case for hospital-driven monetizations will keep getting stronger. This could be the year that there will be an increase in hospital-driven monetizations. There continues to be a great investor demand for medical office buildings and plenty of capital is available, which means, more medical office buildings might be coming on the market.

5. Repurposing will expand. Repurposing of offices, retail, industrial space and even movie theaters for medical use will become more prevalent in 2013. Repurposing is an attractive option for hospitals as it enables them to move quickly and cost effectively into the market.

6. Compliance will become even more vital. Healthcare reform and other legislation will be enforced more stringently than ever in the coming year. Health providers are now required to self report any violations to the CMS. Providers may decide to minimize their compliance risk by monetizing their medical office buildings.

More Articles on Healthcare Real Estate:

Continued Acquisition Healthcare Real Expected in 2013
4 Ways to Mitigate Costs When Developing Medical Offices
Physicians and Real Estate Leases: What Should Hospitals Know?



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