The Benefits of Healthcare Real Estate in a Shopping Center
What do grocery stores, a pumpkin spice latte, a COVID-19 test, and a flu shot all have in common? They can be all be found at your neighborhood shopping center on a single shopping trip. As physicians expand their reach into retail, it is becoming increasingly common for patients to get their weekly groceries or drop by their local Starbucks while waiting for a medical appointment. Healthcare clinics in shopping centers is an ever-growing segment of the healthcare real estate market. These alternative treatment sites not only allow patients to receive care from a qualified physician but also provides the patients with accessibility and convenience. Patients are no longer just considered people waiting to receive medical treatment, they are the new shopping center customer.
The Benefits for the Medical Practice
- Accessibility and Convenience
- Pricing and Transparency
- Speed and Triage
- Enhanced Customer Experience
Health is top-of-mind for customers with millions shopping for healthcare and related services, comparing costs, and looking for value, including location. These customers want access to quality healthcare that is efficient, and medical practices in shopping centers allow patients the opportunity to receive care during their shopping experiences. Couple this with the extended hours, the right retail location can create a better experience for patients and caregivers. Retail-oriented sites offer an alternative to more expensive operations in medical areas.
The Benefits for the Shopping Center Owner
- Increased Stability and Longer Commitments
- A Diversified Tenant Mix
- Increased Foot Traffic and Sales Growth
- Improved Cross-Selling
- Enhance Customer Experience
- Returning/Loyal Customer Base
Shopping centers are all about having the right tenant mix to attract and maintain customers. For healthcare real estate, the customers are not the only shoppers, but physicians, nurses, and technicians will be part of the customer mix. Medical practices make a great tenant in shopping centers as they often have high credit ratings compared to traditional retailers and sign longer leases due to the high cost of build-out. Further, outparcel healthcare tenants will aid in evening out parking demand and provides a more even flow of customer traffic in a shopping center.
Aging demographics and changing consumer preferences take credit for the shift of healthcare to retail settings. In recent years, out-patient healthcare facilities have met the needs of an increasing patient base. More patients have access to care due to expanded healthcare coverage, and as of recently, patients will be more attentive to their health due to habits created from the COVID-19 pandemic. With a unique value proposition, shopping centers can capitalize on these new consumers and their need for efficiency, in terms of cost and convenience. According to a survey conducted by NRC Health, 80 percent of patients would change providers based on convenience factors alone. Further, according to Accenture, from 2006 to 2017, the number of healthcare retail clinics grew 47 percent, yet only ten percent of U.S. shopping centers have a healthcare-related tenant. With this data, there is not only plenty of room for growth for shopping center owners, but an opportunity for healthcare practices to expand their business.