Healthcare construction thriving in Northeast

ANNAPOLIS, Md. — Healthcare real estate construction is booming in the Northeastern United States, according to healthcare real estate data service Revista.

In its inaugural regional market report, the HRE data firm says 66 construction projects totaling $7.9 billion and 8.9 million square feet are underway or in late planning in New York, Connecticut and New England. The Northeast market report was unveiled May 20 at an invitation-only launch event at the offices of law firm Foley & Lardner LLP in Boston. HRE data for other regions and the United States as a whole will be released later this spring.

“The level of healthcare real estate construction activity seen in the Northeast bodes well for the rest of the country,” says Mike Hargrave, one of Revista’s founding principals. “Although we don’t have national data yet, we would not be surprised to see similar levels of activity in other parts of the nation.”

The Northeast launch event was attended by more than 40 hospital, health system and physician practice group executives and HRE professionals. The event, sponsored by Foley & Lardner, included presentations by Revista principals Mr. Hargrave and Hilda Flower Martin. It also included a series of panel discussions featuring Revista’s founding advisory board members, as well as other industry experts including Christopher J. Donovan, Attorney, Foley & Lardner; Robert Milligan, senior vice president – corporate finance, Healthcare Trust of America Inc. and Frank Nelson, executive director – capital markets, Cushman & Wakefield.

Other highlights of Revista’s Northeast market report include:

  • There are a large number of medical facilities in the Northeast, including 473 general acute care hospitals, 4,491 medical office buildings and 2,105 other healthcare buildings.
  • Most medical facilities in the region are affiliated with a health system. Forty-four percent of MOBs are affiliated with a hospital, 36 percent of MOBs are affiliated with a health system and 68 percent of hospitals are affiliated with a health system.
  • Construction of healthcare facilities in the Northeast is going strong. This includes 43 MOB/outpatient facility projects totaling more than 4.35 million square feet with a total value of almost $2.9 billion, and 23 hospital/inpatient projects totaling more than 4.5 million square feet with a total value of more than $5 billion.

A state breakdown of hospitals being built or in the late planning stages is as follows:

State Number of Projects  Total Square Feet  Approximate Value (millions)
Connecticut41,336,000$1,081
Massachusetts7 641,543  $555
Maine2 401,000$287
New Hampshire00$0
New York102,171,000 $3,087
Rhode Island00$0
Vermont00$0
Totals234,549,543 $5,001

By state, MOB projects under construction or in the late planning stages are as follows:

State Number of Projects  Total Square Feet  Approximate Value (millions)
Connecticut9708,139 $464
Massachusetts11 756,263$595
Maine5 398,700$50
New Hampshire2190,974$124
New York162,299,871$1,649
Rhode Island00$0
Vermont00$0
Totals434,353,957$2,882

Revista plans to release more detailed HRE data for the Northeast, as well as reports for other regions and the United States as a whole, this summer. For more information, please contact Mike Hargrave of Revista at 443-949-8794 or mike@revistamed.com.

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Posted June 11, 2014

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