Medical Office 1031 Exchange Properties

The widest choice of healthcare buildings, from single-physician offices to health system clinics.

Medical office gives an exchanger the most choice of any healthcare property type, from small single-physician buildings to health system clinics, across nearly every price range. Wherever your exchange lands, there is likely a medical office that fits it.

The fundamentals are strong. JLL reports medical outpatient occupancy at a record 92.7%, with new construction near 1% of existing inventory, so demand is being absorbed by buildings that already exist.

Start with your dates, then look at what is on the market today.

Why Medical Office Works for a 1031 Exchange

Health system tenants. Health systems accounted for 46% of the medical outpatient leasing JLL tracked in 2025, bringing balance-sheet credit to the lease. HCA Healthcare, for example, is rated BBB by S&P.

Tenants who stay. Medical tenants invest heavily in their space and build their patient base around the address, so they renew far more often than ordinary office tenants.

Pricing in line with the market. MMCG Invest put average medical office cap rates near 6.9% in the first quarter of 2026, with health system leases at the lower end and smaller operators at the higher end.

Liquidity when you sell. REITs, private equity, 1031 buyers and physician groups all compete for well-leased medical buildings. Welltower alone agreed to sell a $7.2 billion outpatient medical portfolio in late 2025, a sign of how deep the buyer pool is.

What to Check Before You Identify

Before you identify a medical office, read who signed and guarantees the lease, how many years remain, whether the landlord still carries the roof and structure under a double-net lease or the tenant carries everything under a true triple-net lease, and whether the location still works if the tenant leaves. Buildings near hospitals and in growing suburbs re-lease most easily.

Comparing a building to a DST? See when a DST makes sense, and when it doesn’t.

Questions Exchangers Ask

Single-tenant or multi-tenant medical office? For most exchangers, single-tenant is simpler: one lease, one tenant paying expenses, and far less management. Multi-tenant buildings can offer more yield but act more like an active business.

Can a medical office replace debt from my sale? Yes. Medical office is widely financed, and our sister company, Healthcare Real Estate Fund, arranges acquisition financing for healthcare properties.

Sources: JLL 2026 Medical Outpatient Building Perspective; MMCG Invest, U.S. Medical Office Market Outlook 2026; S&P Global Ratings via Investment Grade Research; Welltower 2025 disclosures. Pricing and lease term reflect listings tracked by Investment Grade Research and update automatically. This is general information, not tax, legal or investment advice.