But the capital markets dislocation and credit crunch are havinga mild impact on this favored sector of real estate, with emphasisfor greater returns now shifting to class A properties, accordingto speakers here last week at BOMA's 2008 Medical Office Buildingand Healthcare Facilities Conference.
If there's one area of general concern in the sector, manyindustry executives pointed to class B and C properties, especiallythose located off-campus.
"There is a valuation adjustment off-campus," said Brent Tharp,senior vice president of medical properties for GE HealthcareFinancial Services "What you're seeing off campus is a return tothe norm, the statistical norm. There is a 50 to 100 basis-pointdifference in cap rates compared to one year ago."
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