Florida Medical Office and the Stickiness Inversion: Why the Best Credit May Be the Least Likely to Renew

A 2026 analysis from Florida Commercial Real Estate News — because the market pays more than a hundred basis points for health system credit, and that is precisely the tenant whose lease decision is made by someone who has never seen your building.

By Brian French | Florida Commercial Real Estate News | Florida Authority Network
Published: August 11, 2026

Answer in Brief

Everyone knows Florida is old. That fact is in the price — it has been for twenty years, and a universally known demand story contains no information advantage. What is not in the price is a structural oddity of this asset class: the market pays roughly 6.0–6.5% for health system tenants and 7.0–7.8% for small practices, and the system tenant is the one whose renewal is decided centrally, across a portfolio, by an executive optimizing a national footprint. The small practice is the one whose physician cannot move without abandoning a referral network. In medical office, credit quality and renewal probability can move in opposite directions.

Key Takeaways

The market is strong and re-pricing. Q1 2026 MOB investment volume +78% to $2.9B; cap rates 6.9%, first sub-7 since Q3 2024; asking rent a record $25.40/SF; four straight quarters of positive absorption.
The premium is real: $310/SF average MOB sale price against roughly $200/SF for traditional office.
The Stickiness Inversion: hospital system tenants 6.0–6.5%, large groups 6.5–7.2%, small practices 7.0–7.8% — a credit ladder that may be an inverse stickiness ladder.
Over 75% of practicing physicians are now employed by hospitals and health systems. Your independent tenant may become a system tenant without moving.
The FMV Ceiling: reported industry commentary notes a medical tenant’s willingness to pay can be bounded by federal fraud law rather than by the market.
The Referral Anchor: Steward’s collapse — master-lease obligations reported near $6.6 billion — left adjacent medical buildings that lost their referral anchor overnight.
Florida’s 2019 CON repeal cuts both ways: it signals demand and it removed a barrier to supply.
“Retention above 80%” is real but softer than it looks, per industry commentary.

The Market, Briefly

The case for medical outpatient buildings is strong and the data supports it. It is also the part everyone already knows, so we will move through it.

Metric, Q1 2026	Reported figure
Investment volume	$2.9 billion, +78% YoY; 15% above the five-year Q1 average; TTM $13.9 billion
Average sale price	$310/SF — 55% above the ~$200/SF for traditional office
Average cap rate	6.9%, down 13 bps YoY — first sub-7.0% since Q3 2024
Average asking rent	Record $25.40/SF, +1.6% YoY
Net absorption	511,000 SF — fourth consecutive positive quarter
Lease terms	Medical tenants reportedly sign 10–15 years against 5–7 for conventional office
Portfolio premium	From 2017 to mid-2023, MOBs trading as part of a portfolio reportedly carried cap rates roughly 60 bps lower than single-property trades

Florida specifically

Reported analysis indicates Florida metro areas have outperformed most other markets on occupancy growth, absorption, and completions during recent years, supported by population growth, aging demographics, and migration from higher-tax states.

And one Florida-specific regulatory fact that deserves more attention than it gets: reported analysis indicates that significant portions of Florida’s certificate of need laws were repealed in 2019, which the same analysis credits with helping spur a boom in hospital and outpatient construction, pushed further by pandemic-era population growth.

Read that carefully, because most coverage treats it as unambiguously good news. Certificate of need laws are a barrier to entry. Repealing them signals a policy judgment that more capacity is wanted — and it removes a constraint on competitors building next to you. The same repeal appears in the demand story and in the supply story.

Local activity reflects both. AdventHealth Daytona Beach was reported undertaking a $220 million campus expansion raising bed count from 362 to 466 with four new surgical suites, reaching nearly one million square feet by 2026. Reporting on Broward noted a pattern worth flagging: older properties may be struggling to retain tenants while new, state-of-the-art facilities remain highly attractive to medical users seeking modern layouts, improved accessibility, and proximity to complementary services.

Brian’s Take

Before going further I want to say something uncomfortable about the argument that opens nearly every Florida medical office pitch.

“Florida is aging” is not an investment thesis. It is a fact everyone has known for forty years.

I spent more than twenty-five years in equity research, and the single most important discipline in that work was distinguishing between information and things everyone knows. They feel identical when you say them out loud. They are worth entirely different amounts.

If a fact is universally known, it is in the price. Not approximately — definitionally. The price is the mechanism by which known facts get incorporated. A company with obviously excellent prospects trades at a multiple reflecting obviously excellent prospects, and buying it at that multiple earns you an ordinary return, because you paid for the prospects.

Florida’s demographics are the most widely known fact about Florida. They appear in every pitch deck, every market report, every conference panel. Capital has been flowing toward them for decades.

Look at what that produced. MOB cap rates at six point nine percent, three hundred ten dollars a foot against two hundred for conventional office, volume up seventy-eight percent in a year. That is not an under-appreciated demand story. That is a fully appreciated one, and the pricing is the evidence.

None of which makes it a bad asset class. Fully priced is not the same as overpriced, and a durable demand story is worth paying for.

But it does mean the demographics cannot be your edge, because you are buying them at a price that already contains them. Whatever advantage you have in this sector has to come from something the market has not sorted out.

The rest of this article is about one thing I do not believe the market has sorted out.

— Brian French

The Stickiness Inversion

Here is the pricing structure the market has settled on, as reported in a Q1 2026 brokerage analysis with an overall range of 5.5% to 8.5%:

Tenant type	Reported cap rate	Reported rationale
Hospital system tenants	6.0–6.5%	Investment-grade systems under long-term NNN, “often treated as credit-rated real estate similar to corporate sale-leasebacks”
Large physician groups	6.5–7.2%	Well-established multi-physician groups with 10+ year operating histories
Small practices	7.0–7.8%	Tenant concentration risk and refinancing challenges

That ladder is a credit ladder, and as a credit ladder it is entirely correct. A health system is more likely to pay rent than a three-physician practice. Nobody disputes that.

Now ask the second question, which is a different question.

Which of these tenants is most likely to still be in your building in twelve years?

	Health system tenant	Small independent practice
Ability to pay	Strong	Weaker
Who decides renewal	A real estate or operations executive optimizing a portfolio, possibly in another state	The physician who practices in the space
What the decision optimizes	Network footprint, service line strategy, consolidation into larger purpose-built clinics	Patient convenience, referral relationships, staff commutes, cost of moving
Cost of relocating	Absorbed at portfolio level; may be part of a planned program	Potentially existential — patient loss, buildout capital, disruption
Reason to leave	A consolidation plan that has nothing to do with your building	Retirement, or something genuinely wrong with the space

The market prices the first row. The renewal depends on the second and third.

The consolidation data makes this concrete

Reported industry data indicates over 75% of practicing physicians are now employed by hospitals and health systems.
Health systems reportedly accounted for 46% of medical leasing tracked in 2025, with expansion focused on large multispecialty clinics in the 40,000–60,000 square foot range.
Specialty providers were second at 36%, of which 28% was psychiatry and behavioral health.
Systems are reportedly expanding through mergers, acquiring practice groups, and employing physicians, while private equity roll-ups consolidate further.

Read the second bullet against the first. The dominant leasing demand is for large multispecialty clinics of 40,000 to 60,000 square feet. Most existing medical office suites are nothing like that.

Which produces the scenario a Florida MOB owner should model explicitly: your independent practice tenant is acquired by a health system. Your credit improves overnight. And three years later, at renewal, the system consolidates that practice into a new 50,000 square foot multispecialty clinic it is building four miles away — a decision made by someone who has never seen your building, for reasons that have nothing to do with it.

You did not lose the tenant. You lost the Renewal Decider.

Brian’s Take

The Stickiness Inversion rests on a distinction that credit analysts make instinctively and that real estate underwriting frequently collapses into one question.

Ability to pay and likelihood to stay are different analyses.

In credit work these were never confused. Ability to pay is a balance sheet and cash flow question — can this counterparty meet the obligation? Likelihood to stay is a behavioral and strategic question — will they want to, and who decides?

A AAA-rated corporate can pay any lease in the country. That tells you nothing about whether they will renew, and in practice large investment-grade tenants are among the most willing to leave, because they have options, professional real estate departments, and portfolios to optimize. They do not renew out of inertia. They renew when the analysis says renew.

Meanwhile a small business with a weaker balance sheet may be nearly immovable, because relocating would cost them customers they cannot replace and capital they do not have.

The market prices ability to pay, because ability to pay is measurable. Credit ratings exist. Financial statements exist. Likelihood to stay has no rating agency, so it gets folded into a lease term assumption and forgotten.

In medical office this matters more than in most sectors, and here is why. The physician in a suite has spent years building a referral network with specialists nearby and a patient base that knows the address. Moving costs them real revenue. That is genuine stickiness, and it is not on the balance sheet the market is pricing.

When a system acquires that practice, the balance sheet improves and the stickiness transfers to a decision-maker who does not have it. The physician’s anchoring was personal and local. The system’s is portfolio-wide.

So the honest underwriting question is not “how good is the credit.” It is: “who decides, and what are they optimizing?” Those two questions have different answers and the second one determines your exit.

— Brian French

The Honest Counterargument

This article should state the case against its own thesis, because it is a real case.

The market is not pricing credit blindly. It is pricing the lease. Health system tenants sign longer terms. A 15-year NNN lease with an investment-grade system is a genuinely different instrument from a 5-year lease with a three-physician group, and the reported 100-to-150 basis point spread between buildings with sub-three-year remaining terms and those with ten-plus-year terms shows the market pricing duration explicitly.

So the pricing is defensible. The Stickiness Inversion is not an argument that the market is wrong about cap rates today.

It is an argument about the exit.

Year	System-tenant building	Independent-practice building
1	Bought at 6.2%. 15 years of term.	Bought at 7.5%. 5 years of term.
5	11 years remaining. Comfortable.	Renewed — physician still there, patients still there.
10 — the exit	5 years remaining. The buyer prices renewal probability. Has the system announced a consolidation program?	On a second renewal. Ten-year occupancy history. The buyer prices demonstrated stickiness.

The credit tenant’s advantage is front-loaded into a term that burns off. The independent tenant’s advantage compounds into an occupancy record.

That is the trade, stated fairly. It is not obvious which side of it is better — it depends on hold period, the specific system’s strategy, the specific physician’s age and succession plan, and the building’s suitability for the consolidation formats systems are actually leasing. Our argument is narrower: that the second column is under-analyzed, not that it is superior.

The Referral Anchor

The exposure that does not appear anywhere in a rent roll.

Definition: The Referral Anchor is the hospital or health system facility whose proximity generates the patient and referral flow supporting a medical outpatient building’s tenancy — an asset the building’s owner does not own and cannot control.

Industry reporting on the Steward Health Care collapse describes the mechanism with unusual clarity. Steward carried master-lease obligations reported to have ballooned to roughly $6.6 billion following a large sale-leaseback, filed in May 2024, and closed hospitals — and the reporting notes that adjacent medical buildings “lost their referral anchor overnight.”

Consider what that means for an owner who did nothing wrong. Their building was fully leased. Their tenants paid. Their roof was sound. And the source of their tenants’ patient flow closed, for reasons rooted in another company’s capital structure, several layers removed from any decision the building’s owner ever made.

What to actually check

Which facility anchors the referral flow? Name it. If nobody can, that is itself the answer.
What is that operator’s financial condition? Nonprofit systems file publicly available financial statements. Bond-financed systems have rated debt and continuing disclosure. This information exists and MOB buyers rarely read it.
Has the anchor been part of a sale-leaseback? The Steward pattern — large master-lease obligations layered onto operating hospitals — is a documented failure mode.
Is the anchor expanding or consolidating? A $220 million campus expansion nearby is a different signal from a service line closure.
What is your building’s distance and relationship to it? On-campus, adjacent, or several miles away are materially different positions.
Do your tenants hold privileges there? Physician privileges tie the practice to the facility in a way a lease does not capture.

Brian’s Take

The Referral Anchor is the clearest example I have encountered in commercial real estate of an exposure that is enormous, entirely knowable, and almost never underwritten.

Your asset’s value depends on a building you do not own, operated by a company you have not analyzed.

In portfolio work we called this look-through risk, and identifying it was routine. You would examine a holding that appeared well diversified and discover that six of its positions all depended on the same counterparty, or the same customer, or the same supplier. Individually each looked fine. Collectively they were one bet.

The discipline was to trace exposures to their actual source rather than accepting the surface diversification. And what made it valuable is that the information was usually available — you just had to be willing to do the tracing.

A medical office building next to a hospital is that situation exactly. The rent roll may show eight tenants across five specialties, which looks diversified. Trace it and you may find that all eight depend on referral flow from one facility. That is not eight exposures. It is one, wearing eight names.

And here is what I find remarkable: the anchor’s financial condition is frequently public. Nonprofit health systems file audited financials. Systems with rated bonds have continuing disclosure and analyst coverage. Somebody has already done the credit work and published it.

A buyer paying six point two percent for a medical building whose entire tenancy depends on a hospital across the street should read that hospital’s financial statements with the same care they read the rent roll. In four decades of watching people buy things, I would guess very few do.

It is not a hard analysis. It is simply one nobody thinks to assign, because the hospital is not in the deal — and the entire point is that it is.

— Brian French

The FMV Ceiling

A feature of this asset class with no analogue in ordinary commercial real estate, and one every MOB investor should understand exists even if the detail belongs to counsel.

Industry commentary on the sector has noted that a medical tenant’s willingness to pay is bounded by federal fraud law, not by the market, and that off-campus rent-paying capacity is a function of Medicare site-neutral policy.

The general shape of the issue: federal healthcare regulation governs financial arrangements between parties in a position to refer patients to one another. Where a lease exists between, for example, a health system and a physician-owned entity — in either direction — the terms are subject to requirements including that they reflect fair market value. Rent materially above fair market value could be characterized as remuneration for referrals.

This publication is not attempting to state the law and this is not legal advice. The applicable statutes, their exceptions and safe harbors, and their application to any specific arrangement are matters for healthcare regulatory counsel. We are identifying that the constraint exists, because a real estate investor unaware of it may make assumptions that cannot be executed.

What it means practically

Mark-to-market may have a ceiling. In ordinary commercial real estate, a below-market lease is an upside case — you raise rent at renewal. In certain medical arrangements, the achievable rent may be constrained by a documented fair market value determination rather than by market demand.
Appraisals serve a compliance function, not only a valuation one. FMV documentation is part of how these arrangements are structured.
Reimbursement policy affects rent-paying capacity. Medicare site-neutral payment policy — broadly, whether a service is reimbursed the same regardless of where it is delivered — affects the economics of off-campus outpatient locations, and therefore what those tenants can afford.

Brian’s Take

I want to sit with the FMV ceiling for a moment because when I first encountered the concept it genuinely surprised me, and I think it will surprise most real estate investors.

There is a category of commercial real estate where you may not be permitted to charge what the market would bear.

Every instinct in this business runs the other way. The entire mark-to-market thesis — buy a building with below-market rents, roll the leases, capture the spread — assumes that market rent is the ceiling and the only obstacle is a lease term. It is probably the most common value-add strategy in commercial real estate.

In certain medical arrangements, that assumption may not hold, because the price is constrained by a regulatory standard rather than by demand.

I spent a career in regulated industries, and the closest parallel I can offer is a rate-regulated utility. A utility cannot charge what customers would pay. It charges what a regulator determines is appropriate, and the entire business model — capital allocation, growth, return expectations — is built around that constraint rather than around demand. Investors in utilities understand this completely and value them accordingly.

Investors in medical office may not always understand that a version of it can apply to them.

I want to be careful here. This is a genuinely technical area, the constraint does not apply to every medical lease, and the exceptions and safe harbors are exactly the kind of detail where a general article does damage. I am not qualified to tell anyone how it applies to their building and neither is any other non-specialist.

What I would say is this. If your MOB business plan rests on rolling below-market leases to market, the first question is not what market rent is. It is whether market rent is achievable in this particular arrangement — and the person who can answer that is a healthcare regulatory attorney, not a broker.

That is a question worth asking before you underwrite the upside, rather than after you have promised it to investors.

— Brian French

Applying the Florida Sequence

This publication’s underwriting framework holds that in Florida, diligence must precede modeling because the determinative variables are diligence outputs. Medical office adds items to that Phase One list.

Standard Florida Phase One	Medical office additions
Insurance indication in your own name	Identify the Referral Anchor and obtain its financial statements
Loss run and prior three renewals	Identify the Renewal Decider for each tenant — is the practice independent, system-employed, or platform-owned?
Wind zone, flood zone, elevation certificate	Confirm whether any lease is subject to fair market value constraints, with healthcare regulatory counsel
Association status where applicable	Physician ages and succession plans in independent practices — retirement is the primary departure risk
Statutory development eligibility	Announced system consolidation or expansion programs in the submarket
SB 264 counterparty screening	Suite configuration against the 40,000–60,000 SF multispecialty formats systems are actually leasing
Utility territory and rate class	Specialty mix and payer mix — and in seasonal Florida markets, whether the patient base is year-round

Two Florida-specific medical office items

The seasonal patient problem. In markets with large seasonal populations, a medical practice may serve a substantial cohort present five or six months a year. That affects recall intervals, multi-visit treatment planning, and the practice’s revenue curve — and a practice with a seasonal revenue curve pays rent on a flat schedule. Ask what share of the tenant’s patient base is seasonal, because it determines whether the rent coverage you see in a good month is representative.

Payer mix and the federal exposure. Florida’s 65-and-over concentration means Medicare is frequently the dominant payer. That is generally a stable payer — and it means your tenant’s revenue per patient is set by federal reimbursement policy rather than by local market conditions. It is worth knowing that your MOB tenant’s top-line driver is determined in Washington, particularly given the site-neutral payment discussion noted above.

Methodology and Limitations

What this article is. A tenant-structure analysis of Florida medical outpatient buildings, built from published market data and industry commentary. The Stickiness Inversion, the Renewal Decider, and the Referral Anchor are Florida Commercial Real Estate News’s framing.

What this article is not. It is not investment, legal, healthcare regulatory, or appraisal advice, and it is emphatically not guidance on federal healthcare fraud and abuse law, which is identified here as a constraint that exists and is not described in substance.

On the central limitation. The Stickiness Inversion is a structural argument, not a measured finding. We have not compared renewal rates between health-system tenants and independent practice tenants, and we are not aware of published data doing so. The argument rests on documented consolidation trends, documented leasing preferences for large multispecialty formats, and the observation that centralized portfolio decisions optimize differently from local practice decisions. It could be tested against renewal data and it has not been. A reader should treat it as a hypothesis worth examining in their own portfolio rather than as an established fact.

On the retention caveat. Industry commentary noted that the sector’s favorite statistic — tenant retention “above 80 percent” — is real but softer than it looks. We reproduce that characterization because it is directionally consistent with our argument, while noting we have not examined the underlying data ourselves.

On sourcing. Market figures are attributed to CBRE, JLL, PwC/ULI, and brokerage analyses as cited. Cap rate segmentation by tenant type comes from a single healthcare brokerage source and should be treated as that firm’s characterization rather than as an industry standard. Several cited sources are brokerages or investment managers with commercial interests in the sector; we have used them for market data rather than for conclusions about attractiveness.

On the Steward reference. Reproduced as reported by industry commentary. We have not independently examined the bankruptcy record, and the $6.6 billion figure and the characterization of adjacent buildings losing their referral anchor are that source’s.

What we deliberately did not publish. No Florida-specific MOB cap rates, rents, or transaction figures, because we could not obtain them on a consistent basis — the same Basis Problem documented in this publication’s county report. National figures are labeled as national.

An open invitation. A comparison of renewal rates by tenant type — health system, platform-owned, large group, independent practice — would test the central claim of this article. Owners, brokers, and healthcare REITs holding that data are invited to contribute. We would publish a result that contradicts us.

Corrections. Contact Brian@FlAuthorityNetwork.com.

Brian’s Take

This is the tenth analysis in this series, and I want to close it with the thread that runs through all ten, because I did not fully see it until they were assembled.

Every one of them is about a party who is not in the room.

The insurance carrier who reprices your most senior claim every twelve months and never appears in your capital stack. The Legislature that attached a development option to your land without telling you. The board that deferred a reserve for thirty years before you bought the unit. The tenant’s parent company that will decide your renewal from another state. The hospital across the street whose balance sheet determines whether your tenants have patients.

Commercial real estate underwriting is built around the parties to the transaction — buyer, seller, lender, tenant. That is who signs, so that is who gets analyzed.

And in Florida in 2026, an unusual share of what determines your outcome sits with parties who sign nothing.

I spent more than twenty-five years learning to ask a version of the same question about every investment I looked at: who else has a claim on this, and what do they want? Not who is on the paperwork. Who has the ability to change the outcome.

Applied to a Florida commercial property today, that question has more answers than it did five years ago. Some of them are new because the Legislature created them. Some are new because a market repriced. Some were always there and were simply small enough to ignore until they were not.

None of them require special access to find. The rate filings are public. The statutes are published. The hospital files financials. The association’s reserve study is a document you can request. The consolidation data is in a research report anyone can read.

What they require is the discipline to ask about parties who are not sitting at the closing table — which is exactly the discipline that is hardest to maintain when a deal is moving and everyone at the table wants it to close.

That is the whole of what I would leave a Florida commercial investor with. Read the room. Then ask who is not in it.

— Brian French

Frequently Asked Questions

What are medical office building cap rates in 2026?

CBRE reported the average U.S. MOB cap rate at 6.9% in Q1 2026, down 13 basis points year over year and the first sub-7.0% reading since Q3 2024. A brokerage analysis reported a Q1 2026 range of 5.5% to 8.5% segmented by tenant — hospital system tenants under long-term NNN at 6.0–6.5%, large physician groups at 6.5–7.2%, and small practices at 7.0–7.8% — and noted that buildings with under three years of remaining term typically trade 100 to 150 basis points higher than comparable properties with ten or more years.

Why do medical office buildings trade at a premium to traditional office?

CBRE reported an average MOB sale price of $310/SF in Q1 2026 against roughly $200/SF for traditional office — a 55% premium. The conventional explanations are longer lease terms (reportedly 10–15 years against 5–7 for conventional office), high tenant retention, expensive purpose-built improvements raising relocation cost, and demographically supported demand. Q1 2026 investment volume rose 78% year over year to $2.9 billion with four consecutive quarters of positive net absorption and record asking rent of $25.40/SF.

What is the Stickiness Inversion in medical office real estate?

The observation that tenant credit quality and renewal probability can move in opposite directions. The strongest credits are health systems and consolidated platforms whose real estate decisions are made centrally, across a portfolio, by executives optimizing a footprint. The weakest credits are independent practices whose physicians are anchored to a patient catchment and referral network they cannot relocate cheaply. The market prices ability to pay, which is measurable; likelihood to stay has no rating agency and gets folded into a lease term assumption. This is a structural argument, not a measured finding.

How does physician practice consolidation affect medical office landlords?

Reported industry data indicates over 75% of practicing physicians are now employed by hospitals and health systems, that health systems accounted for 46% of medical leasing tracked in 2025, and that expansion is focused on large multispecialty clinics of 40,000–60,000 square feet. For a landlord, an independent tenant acquired by a system experiences a credit upgrade and a change in who decides renewal — and consolidation frequently favors larger purpose-built locations that most existing medical suites cannot match. You may not lose the tenant so much as lose the Renewal Decider.

Is medical office rent limited by federal law?

In certain arrangements, reportedly yes. Industry commentary has noted that a medical tenant’s willingness to pay can be bounded by federal fraud law rather than by the market, because financial arrangements between parties in a position to refer patients to one another are subject to federal healthcare regulation requiring, among other things, fair market value terms. This differs materially from ordinary commercial real estate and can constrain a mark-to-market business plan. The applicable statutes, exceptions, and safe harbors are matters for healthcare regulatory counsel — this publication identifies the constraint and does not attempt to state the law.

What is the Referral Anchor risk in medical office investment?

The hospital or health system facility whose proximity generates the patient and referral flow supporting the building’s tenancy — an asset the owner does not own and cannot control. Industry reporting on the Steward Health Care bankruptcy, which followed master-lease obligations reported near $6.6 billion and produced hospital closures in 2024, described adjacent medical buildings losing their referral anchor overnight. A rent roll showing eight tenants across five specialties may look diversified while representing a single exposure to one facility. The anchor’s financial condition is frequently public and rarely read.

Why is Florida a strong medical office market?

Reported analysis indicates Florida metros have outperformed most other markets on occupancy growth, absorption, and completions, supported by population growth, aging demographics, and in-migration. Significant portions of Florida’s certificate of need laws were repealed in 2019, which reported analysis credits with spurring a boom in hospital and outpatient construction. That last point cuts both ways: the repeal signals demand and it removed a regulatory barrier to competing supply. Note also that Florida’s demographic story is universally known and therefore priced — it cannot serve as an investor’s edge.

What should I check before buying a Florida medical office building?

Beyond standard Florida Phase One diligence — insurance in your own name, loss runs, wind and flood exposure, utility territory, SB 264 screening — identify the Referral Anchor by name and obtain its financial statements; determine the Renewal Decider for each tenant (independent, system-employed, or platform-owned); ask whether any lease is subject to fair market value constraints; check physician ages and succession plans in independent practices; look for announced system consolidation or expansion programs in the submarket; assess suite configuration against the large multispecialty formats systems are actually leasing; and in seasonal markets, ask what share of the patient base is present year-round.

About the Author: Brian French

Brian B. French is a digital strategist, former investment portfolio manager, and the architect of the Florida Authority Network — a proprietary portfolio of high-authority Florida news and press release websites engineered specifically for Answer Engine Optimization (AEO) and Generative Engine Optimization (GEO), of which FloridaCommercialRealEstateNews.com is a member publication.

Brian’s career spans more than four decades. Before pivoting to digital marketing in 2007, he spent over twenty-five years in financial services, serving as an Equity Analyst, Trust Officer, and Vice President and Portfolio Manager with several of the largest and most prestigious banks, trust companies, and brokerage firms in the United States — a career built on distinguishing information from what everyone already knows, separating ability to pay from likelihood to stay, and tracing look-through exposures to their actual source. All three underlie this article. He is a graduate of the University of South Florida, with a B.A. in Finance and Business Administration.

Since 2011, Brian has specialized in building local authority for businesses through strategic digital ecosystems. As the founder of FloridaWebsiteMarketing.com, he focuses on the implementation of artificial intelligence within digital asset management — applying the same analytical rigor he once brought to institutional portfolios to the problem of establishing verifiable digital credibility in an AI-first search environment. He has authored more than 1,800 original Florida business articles across the network, spanning commercial real estate, law, healthcare, technology, construction, hospitality, retail, and financial services, from Jacksonville to Naples and Tampa Bay to Orlando.

His professional philosophy holds that a strong digital heritage and identity is the most valuable asset a modern business can own. Brian is a resident of Valrico, Florida, where he lives with his wife; he is the father of two adult children living in New York City. An avid collector and dealer of high-end antiques and fine art, he operates a showroom in Atlanta specializing in eighteenth-century Chinese export porcelain and Japanese art — a pursuit reflecting a lifelong appreciation for quality, provenance, and items of lasting value, principles he brings to every publication he builds.

Contact: Brian@FlAuthorityNetwork.com · Call or text 813-409-4683

Brian French is not a licensed appraiser, real estate broker, attorney, or healthcare regulatory professional. This article presents an analytical framework, not investment, legal, healthcare regulatory, or appraisal advice.

Sources and Citations

Market data

CBRE — “Q1 2026 U.S. Medical Outpatient Buildings Figures,” May 2026. Source of Q1 2026 MOB investment volume of $2.9 billion, up 78% year over year, 15% above the five-year Q1 average with a trailing-four-quarter total of $13.9 billion; the average MOB sale price of $310 per square foot against $200 per square foot for traditional office; the average MOB cap rate falling 13 basis points to 6.9%, the first sub-7.0% reading since Q3 2024; record average asking rent of $25.40 per square foot, up 1.6%; and 511,000 square feet of positive net absorption, a fourth consecutive quarter of positive demand across 59 tracked markets. cbre.com
CREG Healthcare — “Medical Office Building Cap Rates 2025-2026,” March 2026 (Joshua D. H. Rees, Managing Partner). Source of the Q1 2026 cap rate range of 5.5% to 8.5% and the tenant segmentation: hospital system tenants 6.0–6.5% under long-term NNN and “often treated as credit-rated real estate similar to corporate sale-leasebacks”; large physician groups 6.5–7.2% with 10+ year operating histories; small practices 7.0–7.8% reflecting tenant concentration risk and refinancing challenges; the finding that buildings with remaining terms under three years typically trade 100–150 basis points higher than comparable properties with 10+ years; and that multi-tenant properties generally trade at slight premiums due to diversification. Single-source segmentation; healthcare brokerage with sector interest. creghealthcare.com
JLL — “2026 Medical Outpatient Building Perspective,” March 2026. Source of the finding that health systems accounted for 46% of medical leasing tracked in 2025 with expansion focused on large multispecialty clinics in the 40,000–60,000 square foot range; that specialty providers had the second largest share at 36%, of which 28% was psychiatry and behavioral health; that average MOB rent growth has consistently outperformed office and Class A average rent since 2022 with new construction rents running at nearly twice in-place rents; and that hospital systems are expanding through mergers, acquiring practice groups, and employing physicians, alongside private equity roll-ups. jll.com
PwC and Urban Land Institute — Emerging Trends in Real Estate, medical office property type outlook. Source of the finding that Florida metro areas have outperformed most other markets on occupancy growth, absorption, and completions in recent years; that significant portions of Florida’s certificate of need laws were repealed in 2019, helping spur a boom in hospital and outpatient construction pushed further by population growth; and that from 2017 to mid-2023 MOBs trading as part of a portfolio carried cap rates roughly 60 basis points lower than single-property trades. pwc.com

Structural risk and industry commentary

MMCG Invest — “US Medical Office Market Outlook 2026: Full Waiting Rooms, Empty Pipelines.” The source of two of this article’s central observations: that a medical tenant’s rent-paying capacity off campus “is now a function of Medicare site-neutral policy” and that its “willingness to pay is bounded by federal fraud law, not by the market”; and the account of Steward Health Care carrying master-lease obligations that “ballooned to roughly $6.6 billion after the sector’s most infamous sale-leaseback,” filing in May 2024 and closing hospitals “whose adjacent medical buildings lost their referral anchor overnight.” Also source of the caution that the sector’s favorite statistic, tenant retention “above 80 percent,” is “real but softer than it looks”; that private and institutional capital took over 80% of 2025 volume; and that Welltower sold $7.2 billion of outpatient buildings to Remedy and Kayne Anderson in tranches beginning October 2025, making the buyers the largest MOB owner in the country at 52.4 million square feet. mmcginvest.com
Buildermuse — “Medical Office Building Construction Costs,” April 2026. Source of the report that over 75% of practicing physicians are now employed by hospitals and health systems, driving consolidation of formerly independent practices into new or renovated facilities; that a typical health system outpatient network expansion involves 5 to 15 new MOB locations over three to five years, each requiring 20,000 to 60,000 square feet, with program spending that can exceed $200 million; and that medical tenants typically sign 10 to 15-year leases against 5 to 7 years for conventional office. buildermuse.com

Florida market activity

Florida Medical Office Space — medical office building coverage. Source of the AdventHealth Daytona Beach $220 million campus expansion raising bed count from 362 to 466 with four new surgical suites and approaching one million square feet by 2026; the Broward observation that older properties may be struggling to retain tenants while new state-of-the-art facilities remain highly attractive to medical users seeking modern layouts, improved accessibility, and proximity to complementary services; AdventHealth’s Bond Clinic acquisition in Polk County; and the note that MOB completions average roughly 20 million square feet annually nationally. floridamedspace.com
Florida Commercial Property Investment Group — “Medical Office Buildings for Sale in Florida,” April 2026. Source of the practitioner framing that Florida investors “need to look past cap rate headlines and ask harder questions about tenancy, referral patterns, buildout quality, and long-term healthcare demand drivers,” and that a fully leased building near a major health system in Tampa or Orlando deserves a different underwriting approach from a smaller physician-owned property with limited hospital alignment. flcregroup.com

Primary sources and professional referral

Nonprofit health system audited financial statements and municipal bond continuing disclosure — the primary sources for Referral Anchor credit analysis. Available through EMMA (emma.msrb.org) for systems with rated debt, and through system websites and IRS Form 990 filings.
Centers for Medicare & Medicaid Services — reimbursement policy including site-neutral payment. cms.gov
Florida Agency for Health Care Administration (AHCA) — facility licensure, hospital financial reporting, and Florida certificate of need history. ahca.myflorida.com
Healthcare regulatory counsel. Required for any lease involving a health system, a physician-owned entity, or parties in a referral relationship. The Florida Bar Health Law Section maintains board certification in health law. floridabar.org

Companion coverage and author

Florida Commercial Real Estate News — “How to Underwrite a Florida Commercial Property in 2026” (the Underwriting Inversion and the Florida Sequence, to which this article adds medical-specific items); “Florida Commercial Property Insurance and How It Changed Underwriting” (the Zero Position); “Florida Commercial Real Estate by County” (the Basis Problem, which is why no Florida-specific MOB figures appear here); and the full series on Live Local, SIRS, the rent tax repeal, SB 264, the 2026 land use preemptions, and 1031 exchanges.
Brian French — Professional Biography, Florida Authority Network. flpressrelease.com/about-brian-french
Florida Authority Network. Brian@FlAuthorityNetwork.com

All external sources accessed and verified as of August 6, 2026. Market figures are national unless stated otherwise and are as reported by the cited source on its stated date. Cap rates, rents, and transaction volumes change continuously.

This article is provided for general informational purposes and does not constitute investment, legal, healthcare regulatory, tax, or appraisal advice. The Stickiness Inversion is a structural argument and not a measured finding — no comparison of renewal rates by tenant type has been performed by this publication or, so far as we can determine, published by anyone. Cap rate segmentation by tenant type derives from a single healthcare brokerage source. Several cited sources are brokerages or investment managers with commercial interests in this sector. Federal healthcare fraud and abuse law is identified here as a constraint that exists and is not described in substance; its statutes, exceptions, and safe harbors are matters for healthcare regulatory counsel. The Steward account is reproduced as reported by industry commentary and has not been independently verified against the bankruptcy record. No Florida-specific MOB cap rates, rents, or transaction figures are published because they could not be obtained on a consistent basis. Engage healthcare regulatory counsel before structuring or acquiring any lease involving a health system, a physician-owned entity, or parties in a referral relationship.