GLOBAL HEALTHCARE SERVICES

NEWMARK

437 MOBs Totaling $4.38B Closed in Strong Third Quarter 2021

Commentary by: Eric Murphy, Managing Director, Global Healthcare Services


Medical Office Building (MOB) sales saw a flurry of transactions during the third quarter of 2021, with a 103% increase in transaction volume compared to the third quarter of 2020. Year-to-date transaction volume through the third quarter has also increased by 13% compared to the first three quarters of 2020. With more investors entering the MOB space, third-quarter cap rates compressed to 6.2%. The tightening market drove the average price per square foot ($/SF) to $377—the highest it has been in the past five years.


The third quarter of 2021 saw the third-highest quarterly volume over the past five years, as 437 MOB properties closed during the quarter. States with the most third-quarter activity included California, Georgia, and Texas, which made up for 33% of the total transaction volume. The largest single MOB property transaction was 153 Townsend Street in San Francisco, which sold to Ellis Partners for $231 million, or $1,375 per square foot.



Current Conditions


Average Cap Rate – 6.2%


Average Deal Size – $10.0M


Average Price Per SF - $377



Largest 3Q21 MOB Sales Transactions


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Source: RCA


All information contained in this publication is derived from sources that are deemed to be reliable. However, Newmark has not verified any such information, and the same constitutes the statements and representations only of the source thereof, and not of Newmark. Any recipient of this publication should independently verify such information and all other information that may be material to any decision that recipient may make in response to this publication, and should consult with professionals of the recipient's choice with regard to all aspects of that decision, including its legal, financial, and tax aspects and implications. Any recipient of this publication may not, without the prior written approval of Newmark, distribute, disseminate, publish, transmit, copy, broadcast, upload, download, or in any other way reproduce this publication or any of the information it contains. This document is intended for informational purposes only and none of the content is intended to advise or otherwise recommend a specific strategy. It is not to be relied upon in any way to predict market movement, investment in securities, transactions, investment strategies or any other matter.

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