Why Buildout Costs Are Changing the Game

Ask any healthcare operator who’s built out a new space in the past 12 months, and they’ll tell you the same thing: it’s expensive.

Plumbing for sinks in every room, lead-lined walls, oxygen lines, soundproofing, ADA compliance, specialty lighting, backup power — the list goes on.

Even modest outpatient clinics are pushing well into the $100–$200 per square foot range (or more), depending on complexity. And that’s before furniture, licensing, or tech installs.

So what does that mean for real estate?

It means the stakes are higher. A tenant who drops half a million on a buildout isn’t looking to bounce in 3 years. They want stability. They want favorable lease terms. And they want a space they can grow into — not out of.

For landlords, this changes the conversation. If you’re marketing medical-ready space, showing proof of recent upgrades or infrastructure investments (like med gas or power capacity) can go a long way.

For brokers, it’s a powerful leverage point: showing clients how upfront capex on the real estate side might be worth it for long-term operational savings.

And for valuation? Medical buildout costs absolutely play into replacement cost, tenant commitment, and property performance. They’re not just line items — they’re value drivers.

Healthcare operators want partners who understand the real costs of doing business. If you’re in the real estate side of that equation, helping them avoid unnecessary buildout expenses—or at least plan for them wisely—will put you ahead.

📅 Book a call if you’re planning a new healthcare space or reviewing a deal that involves significant buildout costs.

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