Healthcare Capital Markets 2025 Outlook

Transaction Activity Is Expected To Strengthen The Fed’s cutting cycle will progress cautiously

2024 Sales Volume Up 61% YOY

$35

6%

• Medical outpatient building (MOB) transaction activity tends to strengthen as interest rates decline. As financial market conditions loosen and the cost of capital improves, deal activity follows. • Deal activity picked up in 2024, with sales volume up 61% compared to 2023. This momentum is expected to carry into 2025, supported by strong fundamentals in healthcare properties. • The Fed has signaled a cautious approach to rate cutting, citing inflation risks. While the pace of rate cuts may be slower than previously expected the Fed projects another 50 basis points (bps) of cuts in 2025 and another 50 bps in 2026. • Although liquidity conditions were challenging throughout 2024 due to tighter debt availability and less active capital markets, the forecast is improving for 2025.

$30

5%

$25

4%

$20

3%

$15 Billions

$13

2%

$10

$8

1%

$5

$-

0%

2017Q1

2021Q1

2015Q1

2018Q1

2016Q1

2019Q1

2014Q1

2022Q1

2017Q3

2021Q3

2023Q1

2025Q1

2015Q3

2018Q3

2026Q1

2016Q3

2019Q3

2024Q1

2014Q3

2020Q1

2022Q3

2025Q3

2023Q3

2026Q3

2024Q3

2020Q3

MOB Sales-Rolling 4QTR

10-Year Treasury (RHS)

SOFR - 1 month (RHS)

Linear (MOB Sales-Rolling 4QTR )

Source: RevistaMed, U.S. Board of Governors of the Federal Reserve System (FRB); Moody's Analytics Forecasted

Note: Sales volume includes entity level transactions; 2024 sales data is preliminary

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