Providers increasingly choose retail sites
WESTMINSTER, CO - As healthcare providers grapple with the challenge of attracting and retaining patients, one thing has become increasingly clear: It's about location, location, location.
"If you think of it in terms of being a consumer of healthcare services, the typical pattern or trend is for primary care services most consumers don't want to travel more than 10 or 12 minutes from their home," said Jarrod Daddis, executive managing director for Denver-based healthcare real estate development firm NexCore Group.
According to Daddis, many providers are developing a new retail strategy and making the decision to locate themselves close to where potential patients live, work and shop.
"What we are seeing with healthcare systems around the country is more of a comprehensive healthcare delivery model and the systems are looking to establish spokes in many locations to be a more convenient source of healthcare delivery for their patient base, either existing patients or as a strategy to grow their patient base," said Daddis.
"These are sophisticated providers of healthcare services and so this retail emphasis is now becoming extremely important as part of their strategic initiatives and operation initiatives," he added.
NexCore Group and Daddis were recently involved in the development of St. Anthony North Medical Pavilion, a 48,000-square-foot freestanding emergency department and medical office building in Westminster, Colo., a suburb of Denver. The pavilion is part of St. Anthony North Hospital, a member of Centura Health, and is located at the intersection of two major roads and across the street from a large shopping center.
Daddis says St. Anthony North's location decision is indicative of a nationwide trend he is seeing around location choice and patient convenience.
"It's not just in Colorado but also around the country, particularly in growing suburban areas that have a deficit of physicians," he said. "I think it's demand driven. It's service driven and convenience driven. I think it's a trend that will continue."
Kevin Jenkins, vice president, administrator for St. Anthony North Hospital and St. Anthony North Medical Pavilion, says convenience and service are "at the heart of what we are providing to this community."
The health system will continue to look for opportunities to develop locations near shopping centers and retail sites, said Jenkins.
"This is really part of our strategic plan to move up stream to manage health," he said. "Location is fundamental."
Sydney Scarborough, managing director of financial services firm Jones Lang LaSalle's Healthcare Solutions Group, says providers are becoming more aware of the importance of location and the opportunities that exist to grow their patient base by choosing a site near retail centers.
"Increasingly, health systems definitely are making their location-based decisions based on patient demand," said Scarborough. "One of the biggest location trends is health systems going into retail properties, either centers or stand-alone buildings. ... These type of properties, with ample parking, are tailor-made for healthcare applications."
"Almost universally, regardless of health reform, hospitals and healthcare systems are looking to reach and treat a broader base of patients. It's revenue positive," she said. "Add to that the cost effectiveness of a retail site and this becomes an economically-viable strategy."