What to look for in a healthcare asset
Tenant credit comes first — a hospital system or large group carries different risk than a single-practitioner tenant, regardless of how clean the rent roll looks today. Then read the lease carefully: who actually pays for roof, structure and HVAC, what the escalation schedule is, and whether renewal options are at fixed rents or market. Then the physical asset: clinical space carries specialized plumbing, electrical and HVAC loads, and deferred maintenance on those systems is expensive in ways that general office is not. Finally, location relative to referring providers and hospital campuses, which drives whether the tenant renews.
Where buyers get hurt
The recurring failure is treating a medical building like general office. Buyers assume a triple-net lease means no landlord obligations without reading the exclusions. They underwrite in-place rent without checking it against market, and face a reset at renewal. They skip a systems inspection on a building with twenty-year-old rooftop units serving clinical space. And they miss that a high-performing tenant is tied to one physician nearing retirement. None of these show up in the marketing package — they come out of reading documents and inspecting the asset.
Off-market access
Because we broker the sell side of healthcare assets nationwide, we see properties before they are listed and know which owners would transact at the right number. For a buyer working against a 1031 deadline, that access matters more than anything else — the identification window is short, and competing on marketed deals against every other exchange buyer in the country is the worst position to be in.