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52 Medical Construction & Design | SEPTEMBER /OCTOBER 2016 | MCDM AG.COM GREEN & CLEAN G R E E N & C L E A N ISSUE FOCUS BY KATE MORRIS & VINCE FEMIANO Due to the healthcare law and other forces, hospital systems and other healthcare providers are employing new strategies to serve patients. Traditionally most services were centered on hospital campuses, but just like retailers have known for a long time, healthcare provid- ers are realizing the benefi ts of being close to the communities they serve. Patients like the conve- nience of a nearby physician close to home, rather than driving 30 minutes to a hospi- tal hub. And often a hospital campus visit will involve long walks from a garage to a large medical offi ce building. This is especially diffi cult for the el- derly. Locating within a center with a large grocery anchor, having signage similar to a store and close-in parking are good tactics to attract patients. When healthcare provid- ers first started the retail strategy, many retail centers were not open to the idea. The obstacles included no- percentage rent, the percep- tion that shopper traffic would be less with a medical use and disapproval from other retail tenants. But the biggest problem was the high cost of tenant improvements. Medical tenants typically receive large tenant improve- ment allowances from medical offi ce buildings, often over $50 per square foot. MOB owners provide these large allowances knowing that healthcare groups, especially hospital systems, usually have good credit, or will provide personal guarantees and often renew again and again. Retail property owners traditionally gave only $5-10 per square foot for new tenants. However, retail landlords have slowly gained respect for medical uses. During the Great Recession, vacant retail centers welcomed any uses with open arms, but even higher-end projects have been willing — with some creating "wellness districts" including spas, women's health services and associated uses. Landlords have recognized that physi- cian groups see large numbers of patients daily, and often several family members come to clinic visits and stay to shop. Retail landlords are off ering larger allowances to tenants with excellent credit and lengthy lease terms. Another trend related to the healthcare law and market changes involves the need for less hospital beds. The goal is now wellness and keeping pa- tients out of the hospital. And many more procedures can be done in an outpatient setting, requiring no hospital stay at all. When a hospital needs upgrading, it often makes bet- ter fi scal sense to start a new hospital from scratch, rather than renovate an old hospital. Not to mention that as some neighborhoods change, they REPURPOSE , REUSE , REUSE This lobby of a medical offi ce facility was once a Fresh & Easy grocery store. +35 m patient visits have been logged at convenient care clinics. — ccaclinics.org 2,000 retail clinics, as of 2015, were in operation in 41 states and Washington, D.C. — ccaclinics.org Turning old facilities into new assets to benefi t communities