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3.4M square feet of medical office space coming to NY area
Trend is toward outpatient facilities and more services under one roof
Despite the trend of residential projects replacing hospital facilities in New York City, there is currently 3.4 million square feet of medical office space costing $1.8 billion under development in the New York area, according to health care real estate data firm Revista.
The new cost-conscious health care culture is putting pressure on hospitals to make services efficient for patients — creating a trend toward urgent care facilities replacing emergency rooms and older hospitals making room for outpatient surgery centers, the Wall Street Journal reported.
A greater variety of specialists are also being offered under one roof so that patients don’t have to travel between facilities, as in the case of the Maimonides Medical Center, which broke ground on a 140,000-square-foot facility in Borough Park last week. The $100 million facility will allow patients to visit an array of health care providers in the same building.
“This design is a different way of thinking about and providing care,” said Eric Carmichael, a principal of Frauenshuh HealthCare Real Estate Solutions, the Minneapolis-based company that is developing the property. Health Care REIT Inc. owns the property.
At Mount Sinai in Queens, a historic building was knocked down in 2013 to make way for a primary and specialty outpatient service center.
Investing in new medical office development is also generating impressive returns — health care REIT shares produced total returns of 35.5 percent last year, according to the National Association of Real Estate Investment Trusts. [WSJ] — Tess Hofmann