NAI Keystone’s Principal, Bryan Cole, SIOR, talks about the Medical Office Space in demand in Berks County!

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A recent report by a national commercial real estate firm indicates an increased demand for medical office properties nationwide driven by an aging population, pressures to cut health care costs and new technologies.

And in Berks County, even though signs appear plentiful touting office space availability, overall vacancy conditions are deemed to reflect the national trend with certain qualifications, according to a principal at NAI Keystone Commercial and Industrial LLC, a major commercial real estate firm in Wyomissing.

CBRE Group Inc., a real estate services and investment firm based in Los Angeles, reported an overall 8 percent U.S. medical office building vacancy rate in early 2017 compared to a 13 percent vacancy rate for other market offices for the same period.

Leading the list of markets with lowest medical office vacancy rates were Nashville, Tenn., (2.8 percent), New York (3.2 percent), the San Francisco Bay Area (4.2 percent), Louisville (4.9 percent) and Kansas City (5.5 percent). The strongest medical job growth was pinpointed in Nashville.

“The steep increase in the 65 and over population and anticipated greater need for in-office physician services by this group signals a continued increase in demand for health care services and medical office space in the years ahead,” said Andrea Cross, head of office research, CBRE.

The 65 and older population is expected to double from 2015 and 2055 to more than 92 million and comprise 23 percent of the nation’s population based on estimates by the Census Bureau.

In addition, the CBRE researchers said health care systems nationally are: ” Adopting new technologies in the hope of improving heath care outcomes, reducing costs by relocating services closer to where patients live, utilizing video technology to meet with patients remotely and moving more patient volume away from hospitals – the highest cost facilities – and into lower-cost outpatient facilities, including medical office buildings and urgent-care facilities.”

“I think we are fairly similar in medical office vacancy rates in relation to the types of secondary and tertiary markets of our size,” said Bryan Cole, principal at NAI Keystone. “We, indeed, are reflecting what’s going on overall in the medical field.

“The aging population here is a driving force without a doubt,” he said. “We’ve certainly seen that impact over the past five or six years in the need for health care.

“When you look at the vacancy rates in our area, you see a consolidation happening with multiple practices in one building under one roof. These real estate moves in the health field are often about accessibility and ease.”

Cole said the medical sector locally continues to see growth.

“Several smaller, less efficient medical buildings have been placed on the market for sale or lease, however these facilities are becoming outdated and too small to benefit or attract larger health systems,” he said. “The growth pattern seems to indicate larger, better located facilities, with easy access to customers and better technology.”

In Berks, the medical office growth is stronger in the suburbs and outlying areas as compared to center city, Cole said.

Even though the Berks Community Health Center and a satellite campus affiliated with Penn State Health St. Joseph Medical Center are within the city, the major county health system, Tower Health, is located outside the downtown and so are many other health system satellites and outpatient care facilities.

Older city buildings and fewer competing large health systems overall make for a different medical office vacancy picture in Berks as compared to those larger growing metropolitan centers with competing health systems cited in the CBRE report.

Cole said NAI Keystone doesn’t separately track medical office space, but rather overall market office space in two categories, Class A and Class B. He said the Class A buildings score higher in areas of accessibility, infrastructure, location, amenities, age and specific condition of the properties.

Noting that the local suburban office market was flat through the first three quarters of 2017, Cole said Class A buildings had a roughly 10 percent vacancy rate, while Class B buildings were listed at a 16.98 percent vacancy rate.

In Reading, the 2017 vacancy rate for structures deemed Class A was 7.75 percent, while the less desirable Class B facilities had a 24.50 percent vacancy rate.

Cole said the average rental rates for Class B downtown office buildings are low compared to other markets – $8.50 to $12 per square foot – compared to $11 to $15.50 per square foot for Class A facilities that typically do not include utilities or janitorial services.

In contrast, per-square-foot rental rates for offices in the suburbs are $15.50 to $19.50 for Class B and $19.50 to $24.50 for Class A.

“In our market, we have a lot of clients moving from building to building usually in efforts to increase their footprints (expanded space) rather than going to new locations,” Cole said, noting that new construction in the area has remained flat for the past several years.

While Cole’s report addresses overall office market space versus CBRE’s more narrow breakdown for medical office space, the Class A vacancy rates in both Reading and suburbs were below the national 13 percent vacancy rate for market office space reported by CBRE in early 2017.

Cole cited two building sales, the Teleflex facility along Route 183 and a 200 North Park Road property in Wyomissing, as adding to office vacancy rates in the county this year.

In addition, the V.F. project, which houses many existing tenants, also will probably add additional vacancy space in the next 12 to 24 months, he said.

“At the end of the day, we have a lot of new space on the market today than during the same period last year,” Cole said.

As for commercial real estate signs touting office vacancies, particularly in Wyomissing and Spring Township office complexes, Cole said some of the signs are strategically placed for marketing, but also reflect some tenant movement between buildings or issues involving leasing renewals.

“Basically, yes, I think Berks County is in a good position to meet people’s medical office needs for the future because we have existing structures and land on which to build.

“I’ve seen a lot of real estate reports that come out and blanket everything together, but you have to look deeper at the local situation and account for several factors to get a better indication of what is actually going on,” Cole said.

4631 Penn Ave – Sinking Spring

Property of the Morning… 4631 Penn Ave, Sinking Spring PA

  • Suite 102:  3,200 SF – End Cap former Medical Suite – Can be converted to any use
  • Suite 105:  1,500 SF – Corner Suite

For More Information:  Property Info

For more information, please contact

Bryan Cole, SIOR | Principal

NAI Keystone Commercial & Industrial, LLC

610.779.1400 (O) |

Executive Park in Wyomissing

Property of the Morning… 2001 State Hill Road, Wyomissing PA

  • Suite 105:  3,795 SF – 1st Floor Corner Suite (Can be Combined with Suite 120)
  • Suite 202:  5,580 SF – Corner Suite
  • Suite 120:  9,231 SF – Former Quest Lab Space (Can be Combined with Suite 107)

Eastern PA Office Portfolio - OM Part 1_Page_47_Image_0001

For More Information:  Property Info

For more information, please contact

Bryan Cole, SIOR | Principal

NAI Keystone Commercial & Industrial, LLC

610.779.1400 (O) |

Corporate Campus at Spring Ridge

Property of the Morning… 1350 Broadcasting Road, Wyomissing PA

Only One Suite Remaining for Lease

  • Suite 1:  3,797 SF – Vanilla Box Condition
    • Suite can be built out for any type of use

1350 Brodcasting Road_Page_7


For More Information:  Property Info

For more information, please contact

Bryan Cole, SIOR | Principal

NAI Keystone Commercial & Industrial, LLC

610.779.1400 (O) |

Granite Point – Wyomissing PA

Property of the Morning… 1 Granite Point in Wyomissing.

Two Suites for Lease (Can be combined)

  • Suite 1:  4,274 SF – Existing Medical Suite
  • Suite 2:  5,726 SF – Administrative Suite


For More Information:

For more information, please contact

Bryan Cole, SIOR | Principal

NAI Keystone Commercial & Industrial, LLC

610.779.1400 (O) |

850 N. Wyomissing Blvd. now for Lease

3D Aerial - No TagNAI Keystone’s Bryan Cole is pleased to offer a prime single story office building for lease along N. Wyomissing Blvd.

The building located at 850 N. Wyomissing Blvd. is a 20,600 sf. Single Story building which has 9,050.00 SF available immediately, and another 3,950.00 SF that could possibly be added.

Call for additional details or for an opportunity to tour the building.


For more information, please contact

Bryan Cole, SIOR | Principal

NAI Keystone Commercial & Industrial, LLC

610.779.1400 (O)


Welcome our new agent, Andrew!

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Get to know our newest NAI Keystone family member, Andrew Prinzo:

Q: Where are you from/how long have you been in the Berks County area?

A: I moved to Berks County in 2000 when I was a child and still live in Exeter Township today.

Q: What is your background/interest in?

A: I received my bachelor’s degree from Duquesne University in Pittsburgh, PA where I majored in business management and minored in marketing. I am most interested in learning more about and working on office listings.

Q: What are you most excited about learning while with NAI Keystone?

A: I am most excited about learning the various factors that make each property unique.

Q: What do you like to do in your free time?

A: In my free time, I enjoy playing ice hockey or golf.

Q: If you could travel anywhere in the world where would it be and why?

A: I would travel to Australia. I had travelled there 12 years ago and I loved it. Ever since that trip I have always wanted to return and spend more time in Sydney, Melbourne and Brisbane.

Andrew will engage in all areas of brokerage in the Berks County market including leasing, sales, and advisory services. Andrew recently graduated from Duquesne University and is excited to start a career in CRE focusing on office listings.

Welcome, Andrew! We look forward to working with you and helping you grow your career in CRE!