Medical Office Building Market is Healthy, Transwestern’s Johnson Tells ULI
HOUSTON – (Realty News Report) – The MOB (medical office building) market is strong in Houston and it’s getting stronger, says Eric Johnson, national director of healthcare at Transwestern.
The MOB vacancy rate is about 11 percent but that should drop below 10 percent as newly built medical structures are delivered and absorbed, Johnson said last week, speaking at the ULI Houston luncheon. Some 400,000 SF is under construction currently, adding to the Houston’s supply of 31 million SF of medical and professional buildings.
Investment activity is strong, Johnson said. Last week, Heitman announced the acquisition of 17 MOB buildings, including seven in Texas.
Around the Texas Medical Center, there’s a shortage of research and lab space, Johnson commented.
Bill McKeon, president and CEO of the Texas Medical Center, said the future of the medical center will include more private development in order to complete the “eco-system” by development of retail and multifamily that adds more amenities.
“The TMC3 is a great start,” McKeon said.
The TMC3 is a proposed 30-acre mixed-use development and collaborative research element in the center of the massive medical center where more than 100,000 people are employed. The TMC3 project is expected to include office space, a hotel, retail, a convention center and research space.