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Columbia medical office space tightens, vacancy rate hits 6.4%

Staff Report
Published Feb. 13, 2013

The medical office vacancy rate for the Columbia market was cut almost in half to 6.4% at the end of 2012 as the industry expanded to serve patients’ needs and respond to changes in the health care delivery systems, Colliers International reported today.

The Columbia commercial real estate firm added that year-end vacancy rate for 2011 was 11.9%.

New medical development has been taking place in suburban submarkets rather than in the downtown Central Business District where the vacancy rate dropped to 1.7% at year’s end, Colliers said.

The vacancy rate for suburban medical office space was 7.2% at the end of 2012, nearly five percentage points below 2011’s closing figure.

“Some medical practices are focusing their attention on suburban submarkets allowing patients easier access to facilities closer to neighborhoods,” Colliers said. “Other practices continue to locate within medical office buildings on hospital campuses providing convenience for patients requiring several physicians and treatment types.”

Physicians also are seeing more patients in their offices because hospital stays are being shortened. And, procedures that were once only done in a hospital are now handled in outpatient settings.

Colliers added that there’s a trend to move to better facilities in the medical office market as practices seek to upgrade offices and increase efficiency.

The average asking rental rate of $20.72 per square foot for the market remained steady throughout 2012.

There could be some relief in office space on the horizon as Palmetto Health nears completion of a hospital-medical office complex in the Irmo area. The facility is expected to be completed in December.