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REOC San Antonio: Local medical office market holding steadyREOC San Antonio: Local medical office market holding steadyhttps://www.recenter.tamu.edu/news/newstalk-texas/?Item=116092015-12-22T06:00:00Z

​​​​​SAN ANTONIO – Conditions remained steady in the multitenant, medical-only office market with a third-quarter citywide vacancy rate of 19.5 percent, according to REOC San Antonio's survey of nearly 6.9 million sf of medical office lease space.

​​Compared with the same quarter a year ago, vacancy is up 1.1 percentage points citywide.

“The tenant base remained relatively stable, and medical-only office buildings will remain a staple for many practices," said REOC San Antonio Vice President Carl Bohn. "But some medical-related businesses are venturing into non-traditional space, such as retail and general office locations, and still others are seeking to own their own facilities. Movement into such spaces reduces absorption numbers within the medical-only market; however, a comprehensive look indicates a strong and growing healthcare industry overall.”

“Vacancy rates may soften a little more next quarter due to the anticipated completion of new construction projects,” said Kimberly Gatley, senior vice president and director of research with the firm.

At the close of the third quarter, the citywide average quoted rental rate jumped to $24.49 per sf per year on a full-service basis, a $0.70 increase from the same time a year ago.

“On average, the base rental rate for medical office space has remained relatively stable over the past two years or so. But increased operating expenses, including real estate property taxes, continues to push the overall cost of renting space,” Gatley said.

The far west sector led the quarter in terms of the average cost of renting medical space at $29.89 a sf per year, followed closely by the far north central at $29.41.

“Both areas possess strong medical hubs as well as the capacity to grow, catering to the expanding city suburbs,” Gatley said.

REOC San Antonio
San Antonio-New Braunfels
Office
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