Investors like DaVita’s small price point and the fact that kidney dialysis is a growth industry. Investors take security from the tenant’s investment in the build out of the property and the installation of specialty trade fixtures that make it less likely for the tenant to leave at the end of the lease term. The very nature of DaVita’s business means that a steady and growing routine amongst its clients develops over time providing a reliable income stream tied to an often visited location.
Due to America’s heightened obesity – over 133,000,000 Americans are considered overweight - and aging population, the occurrence of diabetes is increasing. As diabetes leads to roughly 44% of kidney failures, the need for medical facilities offering dialysis will continue to grow. Typically, Patients require three dialysis procedures per week – each procedure taking 3-4 hours. Though a bit morbid, the reality is that dialysis centers can depend upon customers visiting frequently each week and an inelastic demand for their services.
The medical industry as a whole is poised for future growth and net lease investors are only logical in recognizing the stability this lends.
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