Demand remains for medical space - The Explorer: Health

Demand remains for medical space

Oracle Project begins to fill

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Posted: Wednesday, December 30, 2009 12:00 am | Updated: 1:33 pm, Mon Apr 18, 2011.

While residential housing is in a slump and commercial office space has suffered increased vacancy rates during the past year, the demand for medical office space has remained steady.

Tom Nieman, principal and agent at Picor Real Estate Services, is the leasing agent for a new medical office project — Oracle Medical Plaza at 7470 to 7520 N. Oracle Road, just north of W. Ina Road.

"We have three of six buildings going up to accommodate offices for a number of doctors who are partners in this project," Nieman said.

The two buildings located at the front of the project are each two stories, with 6,000 square feet available on each level. Half of each building is already occupied, with an asthma and allergy practice in one building, an orthopedic group in the second, Nieman said.

A medical office building at the back of the site is another two-story structure, with 11,400 square feet on each floor. It is completely occupied by an orthopedic surgery practice on the top floor and an arthritis treatment group on the ground level.

"The entire project is designed to be used for medical purposes," Nieman said, with unusual siting of the buildings allowing drive-up traffic, even to second floors.

"On the east side of the buildings, the ground is terraced up to the second floor to provide drive-up and walk-in parking, which is unique," he said. "There's not anything else quite like it in any medical building facility in the area. It's expensive to build that way, but it accommodates patients better and attracts as much medical business as possible."

Nieman thinks there's somewhat of a pent-up demand for medical office space because "a lot of people are sitting on the sidelines because of the economy, and with the medical profession, because of health care reform. Some are concerned it might affect them more than others."

But the Tucson area is lucky in that it hasn't been hit as hard as larger cities in terms of commercial vacancy rates, Nieman pointed out.

"In Phoenix, the commercial vacancy rate is in the mid-20 percent range," he said, "and that's a much larger market than Tucson, somewhere around 75 million square feet of office space."

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