Medical Office Investing

Medical office buildings generally house healthcare providers such as physician practices, dental offices, outpatient clinics, and specialty medical groups, and are generally distinguished from traditional office space by more intensive building systems, including plumbing for exam rooms, backup power for certain procedures, and specialized ventilation requirements. Columbus, OH benefits from a large healthcare employment base anchored by major hospital systems and academic medical centers, which generally supports demand for medical office space both near hospital campuses and in suburban locations convenient to patient populations throughout Franklin County. Medical office tenants generally have higher build out costs than typical office tenants, which can result in longer average lease terms and higher tenant retention, since relocating a medical practice generally involves significant expense and disruption.

Medical office property held for investment or business use generally qualifies as like kind real property for a one thousand thirty one exchange, and Columbus, OH's strong healthcare sector has made medical office buildings an attractive replacement property option for investors seeking long term leases with relatively sticky tenants. Investors evaluating a medical office building generally review the tenant mix and whether any tenant is affiliated with or credit backed by a larger health system, the building's specialized infrastructure such as generator backup and medical gas lines, and proximity to hospital campuses or complementary medical uses. Because medical office buildings generally carry more specialized building systems than standard office space, Columbus, OH investors generally engage an inspector with medical office experience during due diligence before finalizing identification within the forty five day period.