Medical Office Feasibility Study in the Cincinnati, OH-KY-IN Metro Area

Smaller-than-usual physician office lending

Cincinnati's medical office record is light on every measure. The location quotient is 0.57x, so physician offices carry barely more than half their national weight, and the class is only 11 of 39 locally. A median of $238,050 is just 0.70x nationally, bracketed by $75,000 and $422,750. Even so, the metro ranks 36 of 488 across metro and micro areas, and the 40 loans total $13.4 million. A study can use that modest scale as a reminder that the benchmark is a small practice, not a clinic group.

Counties and programs

Of the 40 loans, 34 are 7(a) and 6 are 504. Hamilton County, OH carries 20 loans, Warren County, OH 7 and Butler County, OH 5. Franchise share is withheld.

Holders

The Huntington National Bank holds the record on 14 of the 40 loans, with $2.8 million, a very large share of the count. Alloy Development Co., Inc. holds 6 worth $4.1 million, a much larger average ticket, which suggests it carries the larger 504 loans. Both are SBA holder tallies and nothing more. FY2018 printed 7 loans and $1.2 million and FY2020 printed 7 and $1.5 million. Eleven other years are withheld.

Limits

Cincinnati physician offices lack a published cancellation percentage or charge-off percentage, and the blanks are not zeros. Hamilton, Warren and Butler enter the count when the 2023 list names them; any county the list omits loses its loans.

What a Cincinnati study should test

A lighter local weight does not mean weak demand, but it does mean fewer comparable deals. A study should test patient panel, payer mix and referral flows around the hospital systems, then price a build-out against a median near $238,050. Run coverage at that median and near $422,750, and where a 504 structure is planned, say whether the practice owns the suite. The appraiser should separate real estate, equipment and practice value. Cincinnati's larger hospital systems employ many physicians directly, which can shrink the pool of independent practices that borrow. A study should address that dynamic, and the practice's payer contracts, before relying on a generic demand estimate. Parking and access to the highway network also shape which suburban or urban location suits a particular specialty.