As 2024 came to a close, the commercial real estate industry began laying out its forecasts for 2025, and several major organizations released their outlooks on the U.S. healthcare landscape. Deloitte anticipated rising revenues, while the American Hospital Association (AHA) highlighted AI’s growing role in patient safety. Nearly everyone had a take on what the year might bring. Now, a few months into 2025, we’re circling back with healthcare experts to see how those early predictions stack up against today’s realities.
One of the key trends experts expect to shape 2025 is the growing challenge of an aging population – and the pressure it places on our healthcare system. According to a report by Johns Hopkins Bloomberg School of Public Health, by 2034, the number of U.S. adults aged 65 and older will surpass the number of children under 18 for the first time in history. It’s a demographic shift with significant implications and one that healthcare leaders are watching closely.
Two Colliers’ experts, Shawn Janus, National Director, Healthcare Services and Marianne Skorupski, Director, National Office Research, provide their insights to these developments: “Overall, the senior housing market has been active, with increased demand for healthcare services that support the aging population — including behavioral health services, where rising demand extends beyond just seniors. However, ongoing labor shortages across the industry, including among physicians, continue to affect the ability to adequately staff facilities and meet the growing demand for space.”
The aging population is impacting the real estate market in more ways than one. Igor Pleskov, Real Estate Attorney and Partner of Saul Ewing notes that geographic expansion is a clear example of this trend. “Healthcare providers are continuing to go towards where the patient can be. This has led to an increased demand for healthcare space in smaller or non-traditional markets.” These non-traditional markets include retail centers, which a growing number of healthcare providers have begun to acquire and repurpose. A recent GlobeSt article, highlights how providers such as physical therapists, chiropractors, dentists, optometrists and even veterinarians are increasingly moving into these “medtail” spaces — blending medical services with retail real estate. “I am seeing the continuation of trends toward outpatient clinics and ambulatory centers in the industry,” Pleskov says. “This has meant a shift towards more traditionally retail locations, even in some cases, former shopping mall space.”
Behind this trend is a clear strategic realignment, as providers rethink how and where they deliver care. “From a strategic perspective, providers recognize the need for a proactive outpatient/ambulatory strategy,” says Skorupski and Janus. “There’s a continuing trend to co-locate complementary services and efficiency with a patient-centered approach.” As brick-and-mortar retail feels the impact of e-commerce, providers are increasingly eyeing these spaces for outpatient care. “Retail conversions often present opportunities to locate outpatient services at attractive locations closer to patients,” they add.
With care shifting closer to the patient, rather than the patient traveling farther for care, this is just one of the trends experts are watching for in 2025. Another significant factor is the continued financial pressure on the healthcare delivery system. “This is affecting all healthcare providers, whether non-profit or for-profit,” says Pleskov. “From a real estate perspective, this has consequences on capital plans, strategic growth, and overall financial planning.”
These pressures are being felt across the board. For instance, according to Fierce Healthcare, labor expenses remain above pre-pandemic levels, while hospitals and health systems also face rising costs in medical supplies, drugs, and purchased services. Additionally, research shows that administrative costs now account for more than 40% of total expenses hospitals incur in delivering care.
Skorupski and Janus also highlight the broader economic factors contributing to this financial pressure. “Much of the current discussion centers around macroeconomic uncertainty, including inflation expectations, interest rates, tariffs, construction costs, supply chain challenges, and labor shortages,” they explain. “As a result, many industry participants are taking a more cautious, strategic approach.”
Remaining cautious is a tendency impacting many sectors, as economic uncertainty progresses. However, Construction Dive predicts steady momentum for healthcare construction. Skorupski and Janus maintain a balanced view: “New construction starts have been impacted due to interest rates, cost increases, and tenant considerations around leasing versus ownership. However, projects already underway are progressing as planned, and leasing demand continues to outpace available supply.”
Overall, perspectives on the healthcare sector in 2025 are optimistic, yet cautious. With aging populations straining already-burned-out staff, many organizations have little choice but to explore opportunities such as geographic expansion and nontraditional approaches like retail conversions.
“There is hope and belief that conditions will improve in the second half of 2025,” says Skorupski and Janus. “While the healthcare industry has not been immune to the broader uncertainties, healthcare real estate continues to be viewed as better insulated than many other asset types.”
“The economy is going to be the biggest factor,” Pleskov notes about the remainder of 2025. “Interest rates, the financial pressure and overall economic headwinds will all be drivers in the medical real estate market. As this plays out, I think there will be a focus on ensuring hospital access for patients throughout the country and an emphasis on coverage.”
An in-depth discussion of the 2025 economic outlook for healthcare will be featured at the 2025 BOMA International Medical Real Estate Conference, taking place May 7-9 in Denver, CO. Click here to learn more.
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