By Michael Lipton, June 8, 2022
Healthcare conversions have proven successful for many years, but today’s unique market conditions have prompted more practices to consider repurposing existing sites, specifically converting vacant office buildings for medical functions.
The U.S. office vacancy rate continues to rise, climbing to 15% in Q1. This excess of empty offices provides a unique opportunity for practices looking to take the next steps in ownership or expansion.
Compounding the ample supply of offices, the cost to build from scratch is prohibitive for many practices. Along with ongoing economic challenges, companies are seeing already high construction estimates go up 10% to 20% over original calculations.
The Benefits of Converting
One of the primary advantages of converting a building is the cost efficiency. New construction is expensive and finding reasonably priced land to build on is scarce. Construction rates – and timelines – continue to go up due to inflation, supply chain holdups and labor shortages.
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