INDIANAPOLIS—Healthcare real estate seems to be continuing its run as one of the industry's strongest sectors. Duke Realty, an Indianapolis-based nationwide commercial real estate company, just reported that on June 30 its healthcare portfolio hit a record occupancy of 95.8%. It was the highest rate for Duke since it entered the healthcare sector in 2007. In addition, by mid-year Duke had completed three more major medical facilities. And this robust level of demand is not confined to certain regions.
“We are seeing solid demand across the country so no one particular area is outperforming,” Keith Konkoli, Duke's executive vice president of healthcare, told GlobeSt.com.
The healthcare segment of Duke's portfolio totals more than 6.5 million square feet, and includes properties ranging from medical office buildings to rehabilitation facilities and from ambulatory care centers with diagnostics, oncology and surgery services to one of the nation's largest cancer centers.
The company signed a total of 122,221 square feet in leases in the first half of the year, including 33,302 square feet of new leases and 88,919 square feet of renewals. The occupancy rate has increased by about 30 bps since the beginning of the year.
Standout transactions included 12,076 square feet of renewals at the WakeMed Brier Creek Healthplex in Brier Creek, NC, and 10,858 square feet of new leases at the same facility. In addition, the company has now completely leased its entire healthcare portfolio in Raleigh, NC.
Duke also reported 36,450-square-feet of lease renewals at the Celebration Medical Plaza on the Florida Hospital Campus in Celebration, FL.
The three newly-developed properties included two rehabilitation hospitals in OH – a 67,043-square-foot facility in Cincinnati and a 54,800-square-foot hospital in Cleveland – and the 37,080-square-foot SCL-Emerus Health Community Hospital in Littleton, CO, near Denver.
“We are extremely pleased with the excellent leasing activity in our medical facilities, which is the highest in our company's history,” added Konkoli. “I believe our record occupancy rate is a testament to our property management and leasing staff's hard work and superior customer service, as well as the strong growth in healthcare demand and clients that want to locate and expand in our high quality facilities.”
When asked if the robust demand seen throughout the country would lead to an aggressive building plan, Konkoli replied it was a “complicated question. The determination on implementing new developments is much more dependent on the specific strategic plans of our hospital partners. We would not launch a general building plan in any market without it being part of the overall strategy we have developed with our partner system.”
INDIANAPOLIS—Healthcare real estate seems to be continuing its run as one of the industry's strongest sectors. Duke Realty, an Indianapolis-based nationwide commercial real estate company, just reported that on June 30 its healthcare portfolio hit a record occupancy of 95.8%. It was the highest rate for Duke since it entered the healthcare sector in 2007. In addition, by mid-year Duke had completed three more major medical facilities. And this robust level of demand is not confined to certain regions.
“We are seeing solid demand across the country so no one particular area is outperforming,” Keith Konkoli, Duke's executive vice president of healthcare, told GlobeSt.com.
The healthcare segment of Duke's portfolio totals more than 6.5 million square feet, and includes properties ranging from medical office buildings to rehabilitation facilities and from ambulatory care centers with diagnostics, oncology and surgery services to one of the nation's largest cancer centers.
The company signed a total of 122,221 square feet in leases in the first half of the year, including 33,302 square feet of new leases and 88,919 square feet of renewals. The occupancy rate has increased by about 30 bps since the beginning of the year.
Standout transactions included 12,076 square feet of renewals at the WakeMed Brier Creek Healthplex in Brier Creek, NC, and 10,858 square feet of new leases at the same facility. In addition, the company has now completely leased its entire healthcare portfolio in Raleigh, NC.
Duke also reported 36,450-square-feet of lease renewals at the Celebration Medical Plaza on the Florida Hospital Campus in Celebration, FL.
The three newly-developed properties included two rehabilitation hospitals in OH – a 67,043-square-foot facility in Cincinnati and a 54,800-square-foot hospital in Cleveland – and the 37,080-square-foot SCL-Emerus Health Community Hospital in Littleton, CO, near Denver.
“We are extremely pleased with the excellent leasing activity in our medical facilities, which is the highest in our company's history,” added Konkoli. “I believe our record occupancy rate is a testament to our property management and leasing staff's hard work and superior customer service, as well as the strong growth in healthcare demand and clients that want to locate and expand in our high quality facilities.”
When asked if the robust demand seen throughout the country would lead to an aggressive building plan, Konkoli replied it was a “complicated question. The determination on implementing new developments is much more dependent on the specific strategic plans of our hospital partners. We would not launch a general building plan in any market without it being part of the overall strategy we have developed with our partner system.”
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
