An aging population in the U.S. will drive not only demand for medical office properties but also a need for more elderly home care services.
CBRE expects the medical office market to prosper in the next few years. Other growth factors for this trend include more health care jobs and the integration of new technology, according to Andrea Cross, Americas head of office research.
Medical Office Demand
Based on its 2018 U.S. Real Estate Market Outlook, CBRE estimated that Americans between 65 years old and above would increase 3.3% to 1.7 million this year. It will increase much higher by 2023 when retirement-age people will grow 18% to 9.2 million.
For this reason, real estate developers need to take action soon enough to prevent a dearth of medical facilities. CBRE said that the medical office market’s occupancy rate has been quite satisfactory in previous years, which should resolve any qualms about venturing into the market. California will be a good start for a potential project, as the Public Policy Institute of California (PPIC) expects a huge increase in retirement-age residents.
California’s Aging Population
A PPIC analysis showed that people above 65 years old in California will increase to 8.9 million in the next 30 years. The anticipated increase stems from more aging baby boomers and a longer life span for the elderly population in general.
On the other hand, this growth trend will require more services from a senior home care in Fountain Valley, Los Angeles among other cities in the state. A caregiver set-up works best for patients that prefer their independence at their own house, as opposed to living in a retirement community.
Property developers should consider investing in more medical offices, as the U.S. healthcare system needs all the help it can get for additional resources apart from existing senior care services.