Trend: Doctors Buying Medical-Office Buildings

IRVINE, CA—In the age of healthcare reform, experts are noticing a growing trend of physicians buying their own medical-office buildings. Dennis Ghan, senior real estate attorney with Palmieri Tyler, tells GlobeSt.com that he has represented several doctors and doctor groups of late in their effort to acquire office properties to build their own medical offices. He says doctors are becoming more business savvy and realizing the financial upside to owning a property as well as renting out space to other doctors and medical groups. In fact, he is currently representing a group of doctors in Long Beach, CA, that is buying property to build a medical-office building.

“Many doctors have the desire to control their own destiny and protect against future rent increases,” says Ghan. Landlords raise their rents, and they’re locked into a location with leverage in negotiating with landlords on rent. They also like the idea that if you own, you can use rent money to help build your personal wealth over time as opposed to paying rent to a third party. With the consolidation of practice groups right now, they want to change the mix a little bit.”