MDNews - Central New York

++++++++++++++++++ + + ++++++++++++++++++ REAL ESTATE +++ +++ Following W hen Shopping for Medical Office Space the Trends By Brian M. Balash, CCIM IN AN EVER-CHANGING MEDICAL field, health care providers have begun to explore new ways to fulfill their real estate needs. Although the concept isn't new, the types of practices trending toward retail locations is. For years, health care providers such as dentists, chiropractors and optometrists have been occupying storefront retail locations, and only recently have they seen the rest of the medical community follow suit. The necessity of being located near a hospital has shifted to become a need to provide convenience to patients. This trend has made location one of the most important factors for a medical tenant to consider. Traditionally, most health care providers would choose to locate within a physicians' office building, which can typically be found in close proximity to a hospital and can provide a wide variety of specialties and a great referral base. More and more health care providers are choosing to occupy retail spaces rather than offices, largely due to the spaces' high visibility and convenient locations for patients. Shopping centers are typically located in high-traffic corridors, provide free, ample onsite parking and offer plenty of tenant signage. Health care providers located in a retail center typically will notice that their patients appreciate the convenient location, as well as the proximity to other services offered at the shopping center. Many of today's retail shopping develop- ments are categorized as lifestyle centers, which combine the traditional retail functions of a shopping mall with leisurely amenities oriented toward consumers. These types of mixed-use destinations offer 14 | Central New York MD NEWS ■ MDNEWS.COM patients the ability to go grocery shopping, pick up their dry cleaning and grab a bite to eat without ever leaving the property. This can come in handy if a family member is visiting for a long procedure that requires someone to pick him or her up. As retailers have largely put a halt to new store openings — and many are reducing their numbers of existing stores and closing underproducing locations — many developers have had a big void to fill. Much like the styles in fashion change with the seasons, the changing trend in medical real estate has been to take advantage of these additional opportunities. Physical therapy, blood draw and urgent care facilities are starting to pop up to fill these vacancies. Health care is no different from any other business in the service industry. If you provide unparalleled service to your customers, they will continue to come back. In addition, patients may be willing to pay more for your services if they see the value in the amenities located around your office. Now don't feel the need to start calling every shopping center in town to look for your new office. Physicians' office buildings provide a great referral base and an infrastructure that can't be matched by a retail location. Retail space is simply something that should be considered when weighing your options. There are many pros and cons when considering a retail location versus a traditional office space. Pros & Cons Retail locations give medical practices exposure to a large group of potential patients who conduct business in or near the retail center. This is a great way to recruit new patients. Because shopping centers typically have multiple entrances, they will also have multiple opportunities for signage. This can allow an inline tenant great exposure to a lot of traffic without having to pay the price for being on a pad site located front and center on the property. The biggest con to consider would have to be the conversion costs. Typically, retail- ers are provided a "vanilla box," and they are responsible for finishing the space to suit their requirements. When converting a space to accommodate medical needs, the expenses can be extremely high. If a practice doesn't have the money needed or a landlord who is willing to contribute toward the costs, it might not be feasible. Adding the possibilities of a retail location into the mix when considering all the options that exist in medical office buildings, you can find yourself easily overwhelmed. Retail and office space leas- ing are two completely different animals. A commercial real estate broker with medical office experience can provide the insight needed to guide you through this process. Brian M. Balash, CCIM, is a licensed sales agent specializing in medical and corporate real estate at Pyramid Brokerage Company, a Cushman & Wakefield Alliance Partner with 10 offices across upstate New York. He is involved with Cushman & Wakefield's Healthcare Practice Group. The Healthcare Practice Group is a national platform of real estate professionals specializing in various sectors of the health care industry such as leasing, acquisition and disposition, and management of highly integrated, state-of-the- art medical facilities. For more information, he can be reached at (315) 445-8506 or bbalash@pyramidbrokerage.com. ■

• Cover