HEALTHCARE FACILITIES MIGRATE TO RETAIL SETTINGS TO TAP INTO PATIENT FOOT TRAFFIC

The retailization of healthcare is in full swing as providers relocate to better align their services with shifting consumer preferences: The number of US medical clinics in retail spaces rose 47% in the last three years, per a new report from real estate services firm JLL.

As patients spend more on healthcare — US consumers’ annual out-of-pocket costs have risen roughly 23% since 2007 — they may be more likely to seek out convenient health services. In turn, providers are deploying new facilities in settings that patients visit during everyday life, like malls and pharmacies.

Moreover, retail centers likely view healthcare groups as high-value tenants, as providers tend to have higher credit ratings, closer ties to the community, and sign longer leases than traditional retail tenants.

We’ll likely see a growing number of specialties and services disaggregated from the hospital find roots in retail space. For example, Dana-Farber Cancer Institute announced plans in February 2018 to develop an outpatient medical oncology and hematology hospital facility at a shopping mall in Massachusetts.