Boca Raton Regional Hospital Opens a $1.1 Billion Tower. Healthcare Growth Pulls Medical Office and Lab Demand With It

Boca Raton Regional Hospital is set to begin admitting patients by the end of October in its new Gloria Drummond Patient Tower, a nine-story addition with 216 private rooms, 20 surgical suites and a 16-bed cardiac intensive care unit, the centerpiece of a $1.1 billion rebuilding of the campus at 800 Meadows Road. The tower also includes an on-site pharmacy, retail, dining and education space.

More to come on the campus

The tower is the first major piece of a larger program by the hospital, now part of Baptist Health South Florida. Plans include more critical care capacity, an expanded Marcus Neuroscience Institute, new surgical facilities and renovations that convert existing rooms to private rooms, all while the hospital stays open. It is one of the largest institutional investments in Boca Raton in years.

Hospitals pull medical real estate toward them

When a hospital adds surgical and specialty capacity, the physicians, outpatient practices, imaging centers and therapy providers who work with it tend to cluster nearby. That drives demand for medical office space within a short drive of the campus, often in buildings with heavier power, plumbing and parking than ordinary office space. Palm Beach County’s general office market was about 11.9% vacant in Cushman & Wakefield’s second-quarter count, but medical space near major hospitals behaves differently, with longer leases and tenants who rarely move once their buildout is complete.

The effect reaches into industrial space as well. Medical supply distribution, diagnostic laboratories, sterile processing and equipment service companies need warehouse and flex buildings that can handle specialized power and climate control. A diagnostics company’s purchase of a new 84,000-square-foot building near West Palm Beach this month is one example of that kind of demand.

What this means for you

If you run a medical practice or healthcare business, space near an expanding hospital campus will be in demand, so plan your next move early and budget for medical-grade buildout. If you own office or flex property near a hospital, healthcare users can be long-term, stable tenants, and the right improvements can widen your appeal to them. If you are investing, medical office near a growing campus offers durable income, provided the building can meet clinical requirements.

AXCESS Commercial helps healthcare users and property owners in Palm Beach County with leasing medical and flex space, listing buildings for sale and managing properties for long-term tenants.

Talk to our team about leasing, listing or managing medical or flex space →