- The O’Quinn Medical Tower in Houston is 2023’s largest medical office building delivery at 400,000 square feet across 12 floors.
- The Houston metro is home to four other medical properties among the 20 largest nationwide — the highest concentration of any metro nationally.
- The second- and third-largest medical properties with a 2023 delivery date are located in Columbus, Ohio, and St. Louis, respectively.
- Six properties in the top 20 are located in Texas, followed by two each in New Jersey, Florida and Kentucky.
Nowadays, a medical office building is rarely a one-story building encompassing a reception desk, waiting area and the office itself. Instead, the growing number of seniors requiring health care and the accelerated population growth of some metros has led to providers tending toward larger, specialized facilities to expand their capabilities in key areas. At the same time, medical office space has come out of the pandemic as one of the more resilient commercial asset types. Accordingly, multi-tenant medical buildings are increasingly popular with investors looking to diversify their portfolios amid uncertainty.
The result is a boom in medical office building construction — both in terms of owner-occupied properties, as well as rentable facilities. So, to gauge where the acceleration in development is concentrated, we ranked the 20 largest medical office buildings (MOBs) to be completed this year and their state distribution. Keep reading to find out which of the markets were home to the highest numbers of large medical developments, as well as a distribution by state.
Houston’s O’Quinn Medical Tower to be This Year’s Largest Medical Office Development
Expected to open its doors in April, the O’Quinn Medical Tower on the McNair Campus is slated to be 2023’s largest medical office delivery at 400,000 square feet across 12 stories. Located within close proximity of the Texas Medical Center, the property will expand the ambulatory surgery center belonging to Baylor St. Luke’s Medical Center with 12 new operating rooms and 10 endoscopy suites. In addition to state-of-the-art medical equipment, the tower will also feature balcony gardens, restaurants and retail space.
Notably, the 27.5-acre McNair Campus is already home to another Baylor St Luke’s medical building — the McNair Hospital Tower — as well as the Texas Heart Institute.
Clearly, the health care sector plays a huge role in Houston’s economy and the demand for Houston office space, as the city is also home to the world’s largest health care cluster (the Texas Medical Center), as well as the headquarters of several major health care providers. What’s more, the metro’s medical infrastructure and supply of med school graduates from the Baylor College of Medicine further contributed to it being home to five of the 20 largest medical office developments in 2023 — far ahead of any other city featured on the list — on top of also being home to the largest MOB development this year.
After the O’Quinn Medical Tower, the next largest development in the Houston metro and the eighth-largest nationally is situated in the Sugar Land, Texas, submarket: The Methodist Sugar Land Hospital is expanding its outpatient care capabilities with Building 4 of its campus — a 160,000-square-foot, six-story medical office building. The building will house neurology, cardiovascular and family medicine, and will also include a seven-level garage with a capacity of 1,150 cars.
Staying in Space City, the very next entry after the Methodist Sugar Land Hospital in the top 20 (#9 nationally) also hails from Houston — a 158,000-square-foot expansion of Kelsey-Sebold Clinic’s Springwoods Village campus. It’s situated in the booming medicine and tech hub of City Place, just north of the city. Moreover, Kelsey-Sebold also plans to expand its Clear Lake clinic in Webster, Texas, which is also in the Houston metro. That build is slated to be this year’s 19th-largest medical development.
What many entries in the top 20 had in common was the fact that they were all owner-occupied expansions of campuses belonging to larger health care operators. That said, the medical office building closing out our list (and Houston’s final entry) is an exception as it’s planned to be a multi-tenant facility housing different practices: Dubbed the 1715 Project, the property is a 107,000-square-foot, Class A medical office development by Tannos Development Group in Friendswood, Texas — southeast of Houston proper.
The only Texas medical development outside of the Houston metro to crack the top 20 is also a multi-tenant medical office building. With 130,000 square feet, Austin’s 1401 Philomena in the Mueller master-planned community is expected to be 2023’s 15th-largest medical development.
Columbus & St. Louis Home to 2nd– & 3rd-Largest Medical Office Developments of 2023
At 385,000 square feet, the Wexner Medical Center in Columbus will be the second-largest medical office building to be completed this year as well as the Midwest’s largest. Among other medical services, the center will house a 55,000-square-foot proton therapy facility, which is an innovative type of oncology treatment.
Not to be outdone, another Midwest medical office rounded out the podium: Mercy Hospital is building a 270,000-square-foot outpatient and surgery center in the Creve Coeur area of St. Louis. The new building is set to open in Q2 2023, and is located at 12120 Conway Road on the site of a former nursing home.
Meanwhile, Chicago was home to the next-largest Midwest medical office development (and seventh-largest overall) with a new, 160,000-square-foot development by Northwestern Medicine in the Old Irving Park area. The development will host a range of medical services, including both primary and specialty care.
Finally, one other entry from the Midwest also made the list of largest medical office facilities under development — the redevelopment and expansion of NorthPoint Health & Wellness Center’s campus in north Minneapolis made it to #11. As a result, all Midwestern entries in the top 20 were owner-occupied facilities from health care companies looking to either expand or modernize their services — a trend that is now the main driving force behind new medical office space construction.
New Jersey, Florida & Kentucky Trail Texas in Number of Large MOB Developments
At the state level, Texas is, by far, home to the largest number of large medical office buildings to be completed this year, primarily due to the five aforementioned Houston entries. In fact, the six medical buildings to be delivered in the Lone Star State add up to 1.07 million square feet of space.
Up next, New Jersey, Florida and Kentucky were tied with two entries each in the top 20. In particular, the total square footage of New Jersey’s medical office buildings under construction was the second-largest total nationally. The Garden State’s two entries stand to be the fourth- and fifth-largest developments this year: The first is the construction of a new ambulatory medical pavilion that will be part of the Robert Wood Johnson University Hospital in New Brunswick at 210 Somerset St.
New Jersey’s second entry is a conversion of an office building into a medical facility situated within New Jersey’s state borders but actually part of the Philadelphia metro area. Namely, Reconstructive Orthopedics will occupy the redeveloped facility, which was formerly the headquarters of IT services company Miles Technology.
Further south on the East Coast, Florida’s entries on the list occupied #6 and #17, totaling 282,000 square feet of medical office space. The larger facility of the two — the Upshot Medical Center at Mills Park in Orlando, Fla. — will provide 160,000 square feet of rentable Class A medical office space to the metro’s market. The new structure is also within close proximity of several other major health care facilities, including AdventHealth University, as well as several life sciences campuses. The other Sunshine State entry hailed from the Fort Lauderdale metro — the Memorial Cancer Institute operated by Memorial Hospital. It’s being constructed on a 6.8-acre site that formerly housed a Toys”R”Us store.
Also in the South, Kentucky’s two entries are both located in Louisville — an outpatient care center operated by Baptist Healthcare took #14 standing at 126,800 square feet, while a lifestyle enrichment facility being built by a venture between Goodwill and Norton Healthcare in west Louisville reached #18.
Finally, Washington, D.C. proper was home to only one of the 20 largest medical developments — the new Whitman-Walker health center on St. Elizabeths Campus at #13. However, two other entries located in the D.C. metro area also made the list: The first of the two — The Ella at Carillon — is a new, multi-tenant facility located within Maryland state limits, which stands to be 2023’s 12th-largest medical office building at 133,000 square feet. And, the next — the Wellness Center at West Falls in Virginia — will bring an additional 125,000 square feet of medical office space to the D.C. area in Q4 of this year while also being its 16th-largest completion.
All property data — including square footage, asset class and projected completion — is courtesy of commercial real estate research and listings platform CommercialEdge. The data was extracted on March 23, 2023.
The study included properties listed as having “medical office” as their primary use type, with mixed-use properties also being included. To make the list, a property had to have a projected completion date between January 1 and December 31, 2023.