The study points out that medical office buildings and other healthcare-related properties could continue to do well, despite the recession, because "healthcare reform bodes well for the sector's future performance. The report contrasts the outlook for the healthcare industry with that of other industries. Nonfarm employment in Los Angeles is forecast to weaken further in 2009, but demand for medical office space "will get a boost from growth in the education and health services industry, where employers are expected to add almost 10,000 positions by year end," according to the report. The US as a whole is also projected to record growth in education and health services employment this year.

Medical office space in Los Angeles might also benefit more from the national healthcare reform efforts to broaden medical coverage and access. Los Angeles has one of the highest uninsured rates in the nation, Marcus & Millichap points out, with more than 25% of the population lacking health coverage, compared to 16% nationally.

The study shows that, with 75% of the L.A. metro's population covered, there is approximately 4.2 square feet of medical office space per insured individual. An increasein the insured rate to even 90% of the population by 2013 would require roughly eight million square feet of additional medical office space, using the current ratio.