Medical office building space in Jacksonville, Fla., is rapidly shrinking in comparison to tenant needs, according to a Sept. 30 report from the Jacksonville Business Journal.
While medical office space in the area is lacking, developing new facilities or moving into preexisting spaces that are not properly tailored to medical practice needs can be difficult.
Medical office spaces require specific customizations, including exam rooms, specialized plumbing and medical equipment installations, which are costly to build out.
Additionally, construction and management companies often will not begin work on new facilities until they find tenants to pre-lease space.
If a tenant signs a lease and occupies less than what a lender requires to allow construction to begin, the tenant faces an unknown timeline of when the building will be developed. After the building is constructed, the tenant has to build out its space, which is time consuming and costly.
When physicians look for facilities to begin private practices — separate from major health systems — they look for buildings to have several key features, such as patient accessibility and proximity to an existing patient base, hospitals or surgery centers. However, these requirements narrow the already limited real estate options.
While outpatient care sites, like medical office buildings, are growing in patient popularity, keeping up with growing demand for real estate is a persistent challenge in several states.