The marketplace works. For years we have heard large insurance companies and health system refer to the need to serve their markets. This service to the markets usually resulted in tidy sums for salaries, bonuses, new buildings, etc. Health consumers were told to shop better and manage their healthcare dollars more closely. Health consumers are doing just that and retail healthcare has blossomed.
The internet and other factors have combined to make recent years tough for retail properties. Medical, on the other hand, has seen no shortage of demand, making medical an excellent alternative for retail spaces that otherwise face challenges in attracting long-term, stable tenants.
There are many signs that healthcare and retail are quickly becoming blood brothers. After retail clinics began opening in 2000, they quickly gained in popularity with almost 1,200 open throughout the country by 2010, according to the Rand Corporation. But that was only the beginning, as the number of clinics more than doubled, according to an earlier report that anticipated over 2,800 clinics operational by 2017. Accenture noted in a report that healthcare clinics showed an astonishing 445 percent growth in the number of clinics nationwide from 2006 to 2014.
In a report from May of this year, consulting firm Bain & Company called retail healthcare companies “the new Starbucks,” noting that “from 2012 to 2017, the number of deals involving retail health companies…has soared, increasing at a compound annual rate of 34 percent in the North American market.”
On its website in an article titled “How Industry Convergence is Reshaping the Future of Healthcare and Retail,” the Huron consulting group cites the 2017 purchase of Aetna by CVS Health as “a development that could push healthcare farther from the traditional physician’s office or emergency room and into a retail environment.”
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