Why Ground-Up Medical Developments Are Quietly Making a Comeback

After a long stretch dominated by conversions and value-add acquisitions, new medical development is starting to creep back into the conversation. Slowly. Quietly. But it’s happening.

In markets where stabilized assets are overpriced and inventory is tight, some investors and healthcare operators are deciding it’s time to build. And not just mega-campus hospitals—we’re talking ambulatory surgery centers, behavioral health clinics, and purpose-built senior living with medical overlays.

The shift is being driven by a few key factors. First, the price gap between buying and building is narrowing. With interest rates high and sellers clinging to peak valuations, many buyers are looking at ground-up development as a cleaner, more strategic play.

Second, operators want control. Designing a space around your program—from patient flow to staff efficiency to integrated tech—has real long-term value. Especially in behavioral health and senior living, where layout and licensing go hand in hand.

Lastly, local governments in growth markets are stepping in with incentives. We’re seeing examples of tax abatements, accelerated permitting, and even land grants—especially when projects tie into community health goals.

This isn’t a return to 2019. But for the right group, in the right market, with the right strategy? Building from scratch is back on the table.

Thinking about whether to build or buy? Let’s talk.

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