The Rise of Medical Office as a Core Real Estate Asset

With office vacancy and uncertainty mounting, medical office buildings are quietly turning into one of the most sought-after property types in commercial real estate. The shift to outpatient care, boosted by demographic pressure from an aging population, is fuelling demand for these buildings in suburban and community settings. That steady demand, paired with long leases and highly profitable tenants, is drawing attention from institutional investors hungry for stability.

Medical offices are no longer niche assets. As of mid-2025, occupancy across the top U.S. markets has climbed to roughly 93.5 percent, with a subset of 42 markets reporting occupancy at or above 95 percent. Rental growth is also ticking up, and new development remains constrained by the high costs and complexity of building for medical use—factors that limit supply even as demand increases. These supply-side constraints, combined with favorable fundamentals, make medical offices buildings more resilient than typical office or retail assets...

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RSK: I see this market rising in our area. Med and Med Science is becoming more and more independent of the Hospital Groups such as imaging, injection, dialysis etc.