Why Medical
Stability and Growth Form the Core of Our Strategy Guiding Every Investment Decision We Make.
At CoreGro, our investment strategy is built on the belief that medical real estate represents one of the most resilient and rewarding sectors in today’s market. Driven by powerful, long-term demand trends and underpinned by essential healthcare services, this asset class offers stable income, strong tenant retention, and lasting value through all market cycles.
The points below detail our strategic focus on acquiring high quality Medical Outpatient Buildings and Specialty Facilities and how these assets provide compelling opportunities for growth, stability, and long-term capital preservation for our investors.
Large, Fragmented Sector
The US healthcare real estate sector is valued at approximately $1.3 trillion, spanning hospital, outpatient and medical office assets across a highly fragmented ownership landscape. This creates meaningful opportunity for experienced investors to aggregate assets, improve operations and build diversified portfolios in a resilient and evolving.
Resilient Tenancy
US healthcare spending is projected to continue rising significantly, with CMS-linked projections indicating growth from $4.9 trillion in 2023 to $8.6 trillion by 2033. Combined with the ongoing shift toward outpatient care, this supports demand for well-located medical facilities and strengthens the long-term case for durable healthcare tenancy.
Essentiality
Healthcare’s critical role in society ensures that medical facilities remain operational and financially robust, even in economic downturns. The essential services provided by these facilities protect investor interests, maintaining stability and viability through all economic cycles.
Stable Leases
Medical real estate is typically supported by long-duration lease structures, with average lease terms often cited at around 12 years, alongside tenant renewal rates of approximately 80% and rent collection rates in the region of 90% plus. Driven by specialized fit-outs and the operational importance of location, healthcare tenants tend to remain in place for extended periods, providing predictable, long-term income visibility and supporting consistent returns.
Capital Preservation
Medical real estate’s advanced infrastructure—superior electrical, plumbing, and structural systems — protects and enhances residual value. These robust features mitigate downside risk, ensuring long-term asset value and preservation of capital in the portfolio.
Buying Opportunity
Current capital market dislocation, elevated construction costs and selective seller pressure are creating opportunities to acquire quality medical real estate at attractive valuations, including assets that may trade below replacement cost in select markets.