Healthcare Law Debate Hasn’t Dimmed Sector Interest

NGKF’s Robert Bach prepared the firm’s latest healthcare report along with leaders of its Global Healthcare Services group.

NEW YORK CITY—Uncertainty over legislation that may or may not replace the Affordable Care Act hasn’t dimmed investor enthusiasm for healthcare properties, says Newmark Grubb Knight Frank. In its latest Healthcare Outlook report, the firm’s Global Healthcare Services group says that demand for investment remains at an all-time high, with 2016 volume coming in just below the record $11.6 billion that traded in 2015, and notes that pending Congressional action is just one of several forces at work in the sector.

“Lost in the high-decibel debate” over ACA repeal are “other disruptors changing the healthcare industry and, by extension, the outlook for medical office buildings and other health care properties,” according to NGKF’s report. It cites recent reports from the Healthcare Financial Management Association that group these disruptors into four categories: a transition to value, consumerism, consolidation and transformative innovation. All four have an ongoing impact on the need for capital and the demand for change in healthcare real estate.