Walk past a new medical building lately and odds are it isn't a hospital. It's an outpatient clinic, an ambulatory surgery center, or a medical office building. Healthcare has been moving care out of hospital campuses for years, and in 2026 that shift is colliding with a supply problem that makes healthcare one of the most active corners of commercial construction.
Demand is up, supply is not
The math is simple. The U.S. population aged 75 and older is growing by more than a million people per year — roughly triple the historical rate — and older patients use dramatically more care. At the same time, new medical office building completions are projected to fall about 26% this year to their lowest level in a decade. High financing and construction costs slowed new starts, so providers are now competing for a shrinking pipeline of purpose-built space, and rents on quality medical space are hitting record highs.
Where the growth is happening
With ground-up supply tight, health systems and physician groups are getting creative. Many are moving into second-generation office and retail space — former bank branches, big-box stores, and suburban office buildings converted into clinics and imaging centers. These conversions put care where patients already are, with parking and visibility a hospital campus can't match. But they're not simple projects: medical conversions demand serious mechanical, electrical, and plumbing upgrades, structural checks for heavy equipment, and finishes that meet healthcare standards.
What owners and providers should know
Healthcare construction rewards experience. Infection control, medical gas, imaging shielding, and accessibility requirements leave little room for a builder learning on the job. And because most of these projects happen in or next to operating facilities, phasing and cleanliness matter as much as speed. Our healthcare work has taught us that early coordination with equipment vendors and the provider's clinical staff saves more schedule than any acceleration effort later.
Our take
The outpatient shift is a long-term trend with short-term urgency: demand is compounding while new supply sits at a decade low. Whether you're a health system leasing converted retail or a developer planning a medical office building, the projects that succeed will be the ones planned around healthcare's unique requirements from day one. Talk to us about your next healthcare project — it's one of the sectors we know best.