Adding Healthcare To Retail Areas Is A Big Trend. But What About Adding Retail To Healthcare?

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The “retailization” of healthcare is a well-documented, recent and successful trend in the country’s medical delivery model.

But what about the “healthcare-ization” of retail?

Northwestern Memorial HealthCare, a 10-hospital system in Greater Chicago, has flipped the script by strategically incorporating innovative retail and food outlets in its healthcare facilities – and it’s working. Gina Weldy, the system’s senior VP, administration, discussed the strategy during a presentation at the International Council of Shopping Centers (ICSC) RECon global convention held May 19-22 at the Las Vegas Convention Center.

“We often go into retail settings as a healthcare provider, but today I’m going to spend some time talking about how we actually deploy retail into our hospital pavilions and our medical office buildings,” Ms. Weldy told the capacity crowd during a presentation titled “How to Add Mixed-Use to a Healthcare Facility” during the Health & Wellness portion of the RECon event. “We have hospitals in the suburban markets and our core academic medical center is a block off Michigan Avenue (home to the well-known shopping district known as the Magnificent Mile), So, we by nature, have a unique retail opportunity, and I think we’ve finally learned how to leverage that.”

Ms. Weldy wasn’t talking about beefing up old-school hospital cafeterias or tired gift shops stocked only with balloons, flowers, cards and stuffed animals. No, she was talking about Northwestern Memorial’s success with bringing in hip, new and attractive restaurant operators and retailers – 36 different lessees in all – into its hospitals and outpatient pavilion settings, with a big focus on Chicago-area food and beverage operations at its massive, main hospital campus just a block off Michigan Avenue near the Streeterville neighborhood just north of the Chicago Loop.

Ever since the health system started working with a retail consultant in recent years to help it determine a retail strategy and to advise it in how to work with retailers and restaurant operators, sales have tripled in its retail spaces.

 

Source: HREI

5 Medical Developments Under Construction In Frisco, Texas

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1. Heritage Business Park

The medical and professional office condos are expected for delivery by December. The outdoor space offers a large green area, water features and benches. The location is in close proximity to Baylor Medical Center, Methodist McKinney Hospital and Baylor Scott & White Medical Center.
Space: 1,300-9,054 square feet
Timeline: delivery fourth quarter of 2019
Address: 11655 Independence Parkway, Frisco

 

2. Baylor Scott & White Institute for Rehabilitation

The Institute is adding an extension to its existing building. It will include a new outpatient/day neuro-therapy gym, a driving simulator room, a neuropsychology and counseling area with an adjacent tranquility room, an enclosed courtyard and neuro-optometry. “This expansion enables the patients and communities we serve to have access to cutting-edge programs, resources and technology,” Baylor Scott & White Institute for Rehabilitation–Frisco CEO Ryan Seymour said in a statement. “The outcome and goal is to get patients, families and friends back to work and actively living normal daily life after injury or illness.”
Space: 12,000-square-foot extension
Timeline: broke ground May 16, expected to be complete first quarter of 2020
Address: 2990 Legacy Drive, Frisco

 

3. Building 2 of Waterstone Office Park

The building is under construction for Class A medical and professional office condos and is set to have seven suites.
Space: 2,178 to 15,740 square feet
Timeline: end of June
Address: 255 W. Lebanon Road, Frisco

 

4. Mateo Office Park

The office park has 14 professional office and medical spaces with its last building set to finish this fall. The development will provide suites from 1,500 square feet as well as a clock tower landmark with a roundabout.
Space: 2,000-10,000 square feet
Timeline: completion scheduled for this fall
Address: 8501 Wade Blvd., Frisco

 

5. Prestonbrook Circle Office Park

The development is set to complete 14 professional and medical office spaces in 2020 and is joined with upscale retail and restaurants for lease and sale.
Space: 1,250-5,790 square feet
Timeline: broke ground in May, completion in first quarter of 2020
Address: 6900 Preston Road, Frisco

 

Source: Community Impact Newspaper

Healthcare Is Entering A New Era Of Medical Office Development

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Meridian CEO John Pollock uses three words to describe the biggest trend in healthcare real estate at the moment: outpatient, outpatient, outpatient.

“As healthcare enters a new era, companies providing more outpatient services are on an upswing,” Pollock said. “We are in an era of tremendous growth in outpatient services,” Pollock wrote in an email to Bisnow. “In fact, we are so sure that outpatient services is where the industry is headed that this sector is nearly our singular focus at Meridian. I believe that as healthcare systems provide more care in a lower acuity setting, they will be able to provide a better experience for patients and at a lower price.”

Healthcare is undergoing a tremendous transformation. Healthcare is adjusting, evolving and growing rapidly as baby boomers continue to retire, millennials and Generation Z mature, and technology continues to shape the healthcare space.

“Now more than ever, bigger players and more money — especially from institutional investors — are entering the industry, CBRE First Vice President Angie Weber said. “These large providers have really taken over and the independent physician has become a thing of the past,”

Weber and Pollock are speaking at Bisnow’s National Healthcare West event June 20. Because of the growing population and the fact that most everyone at one time or another gets sick, healthcare is seen as a safe and resilient investment.

“It’s very safe and strong,” Weber said. “But it’s very expensive. The cost of managing staff and patients, tenant improvements and construction are very high.”

Outpatient demand is driving the development of medical office buildings greater than 150K SF, according to a JLL report released in May.

“No area of growth in healthcare is higher than outpatient services,” Pollock said.

There are currently 44 medical office developments larger than 150K SF under construction in the U.S., according to the report. The projects, estimated at $5.3B worth of investment, total nearly 11M SF and represent 22% of all medical office projects underway, the report states. Of the 44 projects, five are 450K SF or more, one is in the 350K SF to 449K SF range, eight are 250K SF to 349K SF, nine are 200K SF to 349K SF and 21 developments are 150K SF to 199K SF.

“This new trend is a function of the well-recognized growth in outpatient care with its focus on the patient experience and physician convenience with critical services and specialties housed under one roof, with the added goal of accountable care in a lower cost setting,” the report states. “The timing couldn’t be better given the surge in capital seeking investment opportunities in healthcare given the quality of tenancy and durability of medical office properties.”

Weber said the outpatient trend is being driven by a combination of demands from patients and medical providers. Many people, especially millennials, don’t like visiting a hospital for treatment.   Medical providers also find that it costs more to do certain medical procedures in a hospital than an outpatient setting.

“Along with preventive care options, medical providers are opening more specialized healthcare facilities, such as those that offer treatment for depression or post traumatic stress disorder and behavioral and mental health facilities,” Weber said.  “We’re going to see more of that,” she said. “I think you’re going to see these outpatient clinics in all shapes and sizes.”

 

Source: Bisnow