U.S. Commercial Real Estate Market Moves On Healthcare

Growing concern with higher commercial vacancy in the U.S. real estate market continues to weaken confidence while defaults in the Commercial Mortgage-backed Securities Market (CMBS) increase.

President Obama’s new healthcare bill is now encouraging more investors back into the commercial Healthcare real estate market. Some have moved on the growing opportunity as ageing baby-boomers fuel the increasing demand for more long-term care facilities.

Healthcare REITs (Real Estate Investment Trust) have been identified as the next “hot ticket” for speculators in the distressed U.S. economy. As more vacancies increase the availability for new locations, emerging markets with higher concentration of retirees are developing around these targeted areas of anticipated demand.

Real Estate Investment Trusts like HCP, Inc.—which primarily invest and manage the assets of the Healthcare industry to include senior housing, medical offices, hospitals, and skilled nursing homes—are riding the wave upward while retail stores, manufacturing facilities, and office space are taking the plunge.

Many Wall Street investors consider the ageing population as a substantial driving force behind the recent growth in the Healthcare market. With the recent changes in U.S. Healthcare regulations, investors speculate that

Healthcare REITs could witness significant growth as 70-million baby boomers reach the target age, requiring long-term-care over the next five years.

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