Developers and planners should now ask whether urban healthcare facilities may offer similar opportunities for the commercial components of projects. A transformation of the healthcare delivery system is occurring as the nation moves from a reduction of large-scale hospital facilities to the development of smaller facilities such as freestanding emergency departments, ambulatory surgery centers, urgent care clinics and community health centers. At a panel presentation last year to The Wharton Club of New York, Dr. Ezekial Emanuel, a prominent authority on the Affordable Care Act, suggested occupancy levels of the U.S. hospital industry, combined with modern healthcare economics, both were precipitating an inevitable reduction in the nation’s required stock of hospital beds. Dr. Emanuel also mentioned that the average occupancy rate of the nation’s 5,000 hospitals was about 70%—not a robust indicator of fiscal health when compared to the similar metric for the hotel industry. Now, occasionally a few major metropolitan areas may see the development of large-scale facilities such as state-of-the-art proton therapy centers for the treatment of cancer. However, just as national retailers such as Walmart, Best Buy and Staples have been gravitating towards smaller formats, the healthcare industry has increasingly been embracing smaller facilities as part of new delivery models geared towards outpatient care at the expense of inpatient hospital treatment. Therefore, developers of urban retail and mixed-use projects should be mindful of whether the capital expenditure and facility development plans of healthcare operators should be considered in programming the development of infill sites.
So, is healthcare the new retail? Maybe, maybe not. But it does offer new opportunities to incorporate commercial uses amidst retail storefronts or as a substitute for locations where it may be difficult to attract retailers. -- Lamont Blackstone