The 1.2 million-sf shopping mall Rosedale Center in Roseville, Minn., yesterday disclosed its plans for a $100 million-plus expansion that will add a hotel, grocery, multifamily housing, fitness centers, restaurants, coworking spaces, more retail, and a medical office building.
Within the $400 billion global market for healthcare construction, two-fifths of all new retail transactions are for medical offices, compared to 2% a decade ago, according to recent AIA estimates. The number of medical centers in retail space—which Accenture put at 2,800 in 2017, compared to 351 in 2006—could nearly double by 2022, according to JLL projections.
As more developers, landowners, and retail strip owners look for ways to bring a medical facility to their properties, “nontraditional retail spaces for healthcare services are expected to continue to rise in popularity,” predicts JLL in its 2019 research report “Retail and the New Healthcare Consumer.”
Medical office buildings reflect the 'Amazon effect'
That medical offices are finding their way into empty retail space partly reflects the “Amazon effect” that has made online ordering a prevalent mode of shopping and has left bricks-and-mortar vacancies in its wake.
“Healthcare is seeking out locations that are convenient and accessible to their patients,” explains Steve Barry, president of Rendina Healthcare Real Estate, a developer based in Jupiter, Fla. “Retail often has great visibility, great access to traffic count, and plenty of parking.”
Rendina has been exploring this trend for a while now, he says. A few years ago, the firm developed a project for Hilton Head Regional Healthcare in South Carolina that placed a 60,000-sf outpatient facility inside a vacated Publix supermarket with a shopping mall.
Rendina is currently in the process of developing a project that will create an 80,000-sf healthcare facility within a regional shopping mall that Barry says is repositioning itself as a lifestyle center that includes entertainment and grocery venues. Barry couldn’t identify the location or client for this project, but says its construction should start next year.
Retrofitting a retail store for conversion to a medical office depends on the level of care being provided, which may have structural and air ventilation requirements, says Barry.
From a land-pricing and operational cost standpoint, moving healthcare into retail could actually be more expensive than, say, opening a stand-alone facility, because retail stores, says Barry, are generally in higher-density (and higher-rent) locations.
What’s more important, however, is attracting the right kinds of customers to these buildings. “Patients are exerting far more control over where they go for care,” he says.
Barry foresees this trend having some runway left. He expects to see new variations and models, too: for example, his firm is working on developing a hybrid urgent-emergency care facility under one roof, so that patients could access the appropriate care and be charged appropriately for it. Medical offices, says Barry, “would be part of this rehab mix.”
He believes that, despite technology advancements that allow patients to access care from their homes or phones, “healthcare in general will always have a need for space.”
Related Stories
| Mar 3, 2011
HDR acquires healthcare design-build firm Cooper Medical
HDR, a global architecture, engineering and consulting firm, acquired Cooper Medical, a firm providing integrated design and construction services for healthcare facilities throughout the U.S. The new alliance, HDR Cooper Medical, will provide a full service design and construction delivery model to healthcare clients.
| Mar 1, 2011
New survey shows shifts in hospital construction projects
America’s hospitals and health systems are focusing more on renovation or expansion than new construction, according to a new survey conducted by Health Facilities Management magazine and the American Society for Healthcare Engineering (ASHE). In fact, renovation or expansion accounted for 73% of construction projects at hospitals responding to the survey.
| Feb 22, 2011
HDR Architecture names four healthcare directors
Four senior professionals in HDR Architecture’s healthcare program have been named Healthcare directors.
| Feb 17, 2011
HDR Architecture sponsors national effort to green operating rooms
HDR Architecture, Inc. has joined the group of corporate sponsors of Practice Greenhealth’s Greening the Operating Room Initiative. This sweeping and prescriptive path to green the nation’s operating rooms was launched earlier this year to reduce the environmental footprint of the operating suites in hospitals across the country, which can produce between 20 and 30% of a hospital’s total waste.
| Feb 11, 2011
Iowa surgery center addresses both inpatient and outpatient care
The 12,000-person community of Carroll, Iowa, has a new $28 million surgery center to provide both inpatient and outpatient care. Minneapolis-based healthcare design firm Horty Elving headed up the four-story, 120,000-sf project for St. Anthony’s Regional Hospital. The center’s layout is based on a circular process flow, and includes four 800-sf operating rooms with poured rubber floors to reduce leg fatigue for surgeons and support staff, two substerile rooms between each pair of operating rooms, and two endoscopy rooms adjacent to the outpatient prep and recovery rooms. Recovery rooms are clustered in groups of four. The large family lounge (left) has expansive windows with views of the countryside, and television monitors that display coded information on patient status so loved ones can follow a patient’s progress.
| Feb 11, 2011
Two projects seek to reinvigorate Los Angeles County medical center
HMC Architects designed two new buildings for the Los Angeles County Martin Luther King, Jr., Medical Center as part of a $360 million plan to reinvigorate the campus. The buildings include a 120-bed hospital, which involves renovation of an existing tower and several support buildings, and the construction of a new multi-service ambulatory care center. The new facilities will have large expanses of glass at all waiting and public areas for unobstructed views of downtown Los Angeles. A curved glass entrance canopy will unite the two buildings. When both projects are completed—the hospital in 2012 and the ambulatory care center in 2013—the campus will have added more than 460,000 sf of space. The hospital will seek LEED certification, while the ambulatory care center is targeting LEED Silver.
| Feb 9, 2011
Hospital Construction in the Age of Obamacare
The recession has hurt even the usually vibrant healthcare segment. Nearly three out of four hospital systems have put the brakes on capital projects. We asked five capital expenditure insiders for their advice on how Building Teams can still succeed in this highly competitive sector.
| Jan 31, 2011
Cuningham Group Architecture launches Healthcare studio with Lee Brennan
International design firm Cuningham Group Architecture, P.A. (Cuningham Group) has announced the arrival of Lee Brennan, AIA, as Principal and Leader of its new Healthcare studio. Brennan comes to Cuningham Group with over 30 years of professional experience, 22 of those years in healthcare, encompassing all aspects of project delivery, from strategic planning and programming through design and construction. The firm’s new Healthcare studio will enhance Cuningham Group’s expertise in leisure and entertainment, education, mixed-use/housing and workplace environments.
| Jan 31, 2011
HDR Architecture Releases Evidence-based Design Videos
As a follow-up to its book Evidence-based Design for Healthcare Facilities, HDR Architecture, Inc. has released three video case studies that highlight evidence-based design principles in action.
