60 Seconds with Steve

Capital, Capital Everywhere

After attending two conferences focusing on two different healthcare real estate sectors, it is all about capital.

Having just returned from two different conferences in Florida, the one conclusion I can draw from both of them is that there still is way too much capital looking for yield. One, the Revista-sponsored medical real estate conference, was mostly focused on the medical office building market, which transacted more than $13 billion in investments last year. Who would have thought?

The other was the American Seniors Housing Association’s annual meeting, which had record attendance with a lot of “deal talk” going on. One industry veteran told me he was only talking to architects and builders at the conference to get a true gauge on what was happening with development. Based on his conversations, 2018 will be the same or even more active than in 2017.

Given the industry headwinds, why? Because capital needs to be put to work, and there are few investments that appear to have such a long-term demand associated with them. But they have to remember, a lot can change in the long term, including technology, tastes, designs, regulations and affordability. Nothing is static, especially what tomorrow’s 85-year old will want.

 

 

2 comments on “Capital, Capital Everywhere

  1. Good Article Steve. I was wondering if you had seen the 2017 capital investment numbers in senior housing broken down by new construction, refinancings, and acquisitions?

    if you have any guidance on that i would appreciate it.

    1. Thanks Rich. Although we do track new construction and refinancings, we do not have numbers on the total investment size for refinancings and new construction. We do on acquisitions, except for those deals with non-disclosed prices. Our annual Senior Care Acquisition Report provides a lot of the acquisition info.

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