California Centers, Publish Date: September 1, 2018
There’s an increasingly popular tenant on the retail blocks, and it comes with strong credit, high demand, great stability and internet-resistance. The best part? It can backfill vacancies left behind by shuttering retailers like Wet Seal, Payless, Limited and BeBe, all while bringing a brand-new, loyal clientele into your center…
The seemingly overnight shotgun marriage of retail and healthcare is no accident, according to the experts…
… The business of healthcare has become very competitive thanks, in large part, to legislation like the Affordable Care Act that has tasked healthcare providers to be more efficient, deliver faster care to a larger number of people, and oftentimes with fewer resources. As consolidation occurs and reimbursements dwindle, the need to view their target audience as consumers and not patients has become paramount. This has led to what has been dubbed as the “retailization of healthcare.”
MAINTAINING A HEALTHY RELATIONSHIP
Convenience can be key for today’s popular healthcare tenants, but their presence can be less than appreciated by some shopping center staples.
… Matt Hammond, a partner and senior vice president of brokerage for Coreland Companies in Tustin, believes many of today’s retail tenants are willing to adapt.
“Anchor tenants have historically restricted medical uses as co-tenants. However, in today’s market, it is common practice to now avoid these medical restrictions when negotiating leases,” he notes. “Older centers with established anchors can still pose challenges. In these situations, we typically have to pursue approvals but, more often than not, there is little pushback.”
This willingness to adapt not only benefits the medical tenants, but generally its neighboring retailers as well. Hammond is also quick to point out that healthcare tenants don’t generally result in “sick patients” walking around the center to begin with.
“We haven’t seen many problems or have heard many complaints from co-tenants,” he continues. “A lot of these medical tenants don’t just serve the common cold. A lot of the service providers are Specialists – primary care physicians, dermatology, X-rays, sports medicine – attracting customers that do cross-shop before or after appointments.”
For the compete article, go to California Centers September Edition, Page 26.