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Salt Lake City — Cushman and Wakefield | Commerce has completed the first study of Medical Office Buildings to be conducted in the Salt Lake Valley.
The study was conducted by Peter Hanlon and his colleagues in the office division, and the research team of Cushman & Wakefield | Commerce. The study, titled “Market Beat-Medical Office Snapshot,” includes more than 50 medical office buildings in Salt Lake County and is effective through the second quarter of 2013. The study covers 17 on-campus buildings and 34 off-campus buildings, covering 2.5 million square feet.
To be included in the study, a medical office building must be at least 20,000 square feet and must have 51 percent or greater occupancy of medical tenants.
The study shows that overall vacancy for medical office space in Salt Lake County is 16 percent and the average asking lease rate is $13.44 per square foot. Adding an estimated $7 per square foot for operating expenses provides an equivalent asking lease rate average of $20.44 per square foot, full service. There is approximately a $2.20 per square foot premium for on-campus medical office space versus space not located on a hospital campus.
It is projected that demand for Medical Office Space will continue to be strong for the foreseeable future due to:
Demographics in Utah, which includes strong population and economic growth.
Demographics in the U.S., which is showing an aging population of baby boomers.
Increased demand for medical care as a result of the Affordable Care Act, which will provide medical insurance to more than 30 million additional people in the country.
The study can be accessed at here.