Health care/Medical Office Building appraisal

[Raycliff]

I was wondering if anyone out there specializes in healthcare real estate appraisal and could answer the following questions.

1. What is the difference between health care and general commercial appraisal?

2. How is the appraisal process conducted?

3. Is this a good time to be in health care appraisal? I have been reading articles that health care real estate is becoming very popular due to what is happening in D.C and other trends.

 

[The Warrior Monk]

I was wondering if anyone out there specializes in healthcare real estate appraisal and could answer the following questions.

1. What is the difference between health care and general commercial appraisal?

There really is no "general commercial appraisal." If there is one thing that I've learned from doing commercial appraising, it's that no two assignments are alike (note: I don't work in an urban market).

2. How is the appraisal process conducted?

It depends what you mean by "healthcare." There are different types of healthcare properties, and the sources of income can vary within each property class, so the specifics of the valuation can vary significantly.

3. Is this a good time to be in health care appraisal? I have been reading articles that health care real estate is becoming very popular due to what is happening in D.C and other trends.

I personally believe that it is a good field to get into, especially the more complex assignment such as hospitals. However, expect to spend years training in this field under competent individuals before becoming a specialist yourself.

In my own case, I've had the opportunity to appraise some very large and complex healthcare facilities, and even conceptually understand how to appraise them, but have avoided them like the plague since I don't have a specialist to work with. One thing I did find out though; there apparently are very few appraisers that are universally considered competent to appraise the larger facilities.

 

[Michigan CG]

1. What is the difference between health care and general commercial appraisal?

Medical office building are generally worth more than general office buildings because of the specialty of the buildings. They are easy to appraise for the most part as long as there are good comparables.

Hospitals are a different story. I did two when I worked for an MAI. None since, most likely wouldn't do one now.

2. How is the appraisal process conducted?

It is the same as any other assignment.

3. Is this a good time to be in health care appraisal? I have been reading articles that health care real estate is becoming very popular due to what is happening in D.C and other trends.

I doubt many can make a living on just health care facilities. The ones who do are most likely very specialized and do the really big facilities. Those guys are most likely the best of the best and breaking into that business would be very hard.

 

[The Warrior Monk]

I doubt many can make a living on just health care facilities. The ones who do are most likely very specialized and do the really big facilities. Those guys are most likely the best of the best and breaking into that business would be very hard.

The firms that I am aware of that specialize in the larger facilities are larger firms, such as Tellatin, and Cushman and Wakefield. As expected, the leadership at the top is heavy with MAIs, and those working for them have various credentials (MAIs, MBAs, etc.).