At DMCC, we are committed to conducting our due diligence and investing strategically to achieve the highest possible return for our investors. As a result of much research and planning, with the intent of maximizing returns while balancing rental rates and tenant stability, the majority of our portfolio is comprised of medical real estate assets.
Medical real estate has become the cornerstone of our investment portfolio for several key reasons:
1. High-Quality Tenants
As compared with other professions, medical professionals tend to have more stable businesses, making them high-quality tenants. Whereas volatile tenants can risk rental income, medical practitioners are more likely to stay for the long-term and provide reliable income.
2. Long-Term Leases
Private practices in the U.S. typically settle in one location and prefer not to move around, especially once they have established a loyal patient-base. Medical equipment can be costly and difficult to move once it’s installed, providing incentive for practitioners to renew their lease. This means it is possible to escalate rent over 5 year periods to reflect the current market value of the property, increasing the return for investors.
No matter the state of the economy, people will always require medical services. Unlike offices or retailers which can struggle or even shut down in hard times, medical offices tend to be more recession-resistant. This means there is a lower risk of losing tenants or rental income due to changes in the economy.
4. A Well-Diversified Tenant Mix
Medical practitioners will often set up offices in close proximity to other medical professionals who perform different work, resulting in a diverse mix of tenants. It’s common to see a cluster of medical offices including pediatricians, chiropractors, ENT specialists, and so on. They rely on one another for support and networking, without any competition over patients.
A Strategic Approach to Investing
There are a number of reasons why investing in medical real estate is a smart choice. We take a strategic approach to investing in commercial real estate, which includes selecting the types of properties to include in our portfolio. Our process involves regional and economic research, conducting due diligence for each property, accurate valuation, and ongoing efforts to increase property value. Focusing on medical office buildings is just one way we continue to unlock value for our investors.
DMCC Holdings unlocks value and creates exceptional returns with our investors through commercial property in the U.S. and Canada. Get in touch with us to learn more.