March 2-March 15, 2016
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COLORADO REAL ESTATE JOURNAL
— Page 7B
D
uke Realty is active
in the growing
Denver market
and is developing four small
community hospitals for SCL
Health. We’ve found that the
market is extremely busy –
there’s healthy construction
activity, consistent demand
for medical office space and
strong investor interest. Plus,
the growing trend of hospitals
and health systems locating
retail-oriented facilities closer to
patients increased development
activity. The challenges,
however, are that costs are
rising and suitable locations and
subcontractors are difficult to
find in a hot market.
Medical office buildings
dominate.
Health care services
can be delivered in several
different kinds of facilities. In
the 10-county Denver metro
area, medical office buildings
are the dominant type of health
care property. According to
health care real estate data
service Revista, there are 259
MOBs and 127 offices with
medical space compared
with 24 hospitals, 21 retail
establishments with medical
space and 10 medical condos.
This fits the growing trend of
housing services in MOBs and
other low-cost outpatient spaces
rather than more expensive,
more highly regulated inpatient
facilities. These MOBs are
located close to where residents
live and work, providing them
with greater convenience. This
also eliminates the time and
stress involved with driving to
far-off hospitals and navigating
the complexities of the
campuses.
The counties with the largest
number of MOBs are Arapahoe
County with 69 MOBs totaling
3.04 million square feet and
Denver County with 59 MOBs
totaling 3.59 million sf.
Hospital construction remains
strong.
Although MOBs are
increasingly popular, there
are more hospital projects in
the Denver area than MOB
construction projects. In the
past 12 months, seven hospitals
totaling 1.51 million sf and
four MOBs totaling 336,400 sf
completed construction. And
in 2016, it’s predicted that five
hospitals and three MOBs will
be completed in Denver.
That doesn’t mirror a
national trend in which the
number of MOB completions
is rising compared to hospital
completions. In 2015, there
were 258 hospitals completed
nationwide compared to 240
MOBs, which is expected to
shift completely in 2016 to
387 MOBs compared to 251
hospitals.
Some of the biggest health
care construction projects in
progress in the Denver area
include the 130,000-sf Sky Ridge
MOB III in Lone Tree, which
has a planned completion date
of March; the 97,000-sf Denver
Health Clinic MOB, which also
is expected to be completed in
March; the 93,000-sf Swedish
Medical Center Neuroscience
Hospital expansion with an
anticipated completion of
November 2017; and the
86,000-sf Colorado General
Hospital in Broomfield, which is
expected to be completed this
summer.
Glenn Hoge
Senior vice president, Development,
Duke Realty, Indianapolis
T:10.25”
T:7.25”
Courtesy Duke Realty
The freestanding SCL Health Community Hospital in Westminster is in a small neighborhood setting and offers
a wide range of comprehensive health care services that typically are found at a larger hospital campus. This
fits the growing trend of providing residents greater access to the best medical care possible right in their own
neighborhoods.
