Healthcare Focuses on Retail Delivery
How Healthcare Practices Are Looking to Retail Space for Their Next Medical Office
We can all see it - brick-and-mortar retail has been struggling since the onset of COVID-19. Many retail businesses have dealt with staffing issues, supply disruption, and store closures. Therefore, many retail landlords have seen an increase in vacancy or dark spaces. This has provided a unique opportunity for healthcare providers to capitalize on motivated retail landlords seeking long-term credit-worthy tenants. Healthcare tenancy in retail settings was already on the rise pre-pandemic; however, now it is a significant movement across urban, suburban, and rural markets.
The movement incorporates all healthcare services expanding to retail settings. Services such as primary care, specialty care, health & wellness screening, and emergency/urgent care have all taken advantage. Retail settings provide healthcare leaders the ability to explore a wider selection of off-campus locations that can be more convenient and accessible to patients than typical clinic locations, which in turn enhance patient value and experience. Healthcare systems and private practices will continue to seek retail settings as they look to thrive in an increasingly competitive market and race to deliver convenient care to the patient.
It is important to note that there are many differences in a retail setting versus a traditional medical office building, providing distinct advantages and challenges.
Advantages of Retail Space for Healthcare Services
Expansion opportunities in new markets
Convenient care – no appointments and limited wait time
High foot traffic / Ample parking / accessible to public transit
Convenient access / visibility / curb appeal
Co tenancy and nearby amenities
Challenges of Retail Space Used for Healthcare Services
Building infrastructure – HVAC, mechanical, plumbing, power
Permitted uses
Non-medical property management
Physician & Patient relationship
Fun fact: The first retail health clinic opened in Minnesota in 2000 after the frustration a father (and future MinuteClinic co-founder) experienced during a long wait at an urgent care center for treatment of his son’s strep throat. That company, MinuteClinic, was acquired by CVS in 2006, and today they have over 1,100 clinics in CVS and Target stores.
If you would like to explore all potential space options available today for your healthcare business, reach out to Rokos. We are here for you and happy to help.
Rokos Advisors is an award-winning Minneapolis – St. Paul-based commercial real estate/tenant representation firm specializing in helping businesses find the perfect office or industrial space for their company.
*Article authored by Rokos Senior Associate, Jake Sampson