Additionally, the trend toward purpose-built facilities and consolidation within the industry bodes well for investors in this asset class. Overall, we are optimistic about the future of veterinary real estate and look forward to being a part of its continued growth.
Did you know that there are 82 million households in the United States that own pets? And did you also know that these households spent a whopping $39.1 billion on veterinarian care and products? This increased demand for medical services has caught the attention of commercial real estate investors who see veterinarian clinics as valuable additions to their portfolios.
To gain more insight into this unique asset type, Connect CRE spoke with Terravet Real Estate CEO Daniel Eisenstadt. According to Eisenstadt, veterinary practices can be defined as a niche form of commercial real estate with characteristics from various traditional asset classes.
One reason why veterinary practices have become attractive investments is because they have “sticky” tenants – once established in an area, it’s unlikely they will move due to high costs associated with relocation and potential loss of patients.
When evaluating this type of real estate investment opportunity, factors such as location, lease terms and creditworthiness should all be considered along with current market trends like increasing demand for purpose-built facilities.
Overall outlook for this sector looks positive due to ongoing growth in pet ownership combined with interest from institutional investors looking towards consolidation within the industry. As Terravet continues expanding their portfolio through their REIT offering tax-advantaged solutions while providing diversification opportunities.
