Over the last decade, new design and construction has altered the physical characteristics and functionality of the medical building. From a healthcare systems standpoint, the motivation to renovate or build new facilities has been attributed to increased patient demand, technological advances, renewed branding efforts and access to inexpensive capital.
From a small to mid-size provider standpoint, the location attributes have been the greatest influence for continued patient demand and satisfaction. Now, larger, better capitalized systems and retailers have entered the marketplace to capture greater share of the patient marketplace.
To remain competitive, a medical facility owner and/or operator will be required to renovate or be faced with reduced patient volume within the building. Less rent, weaker leases and hemorraghing property values will be exacerbated by relentless commercial real estate up and down cycles.
In this article, we drive the debate for medical tenants and landlords to address their compelling inquires of whether to RENOVATE OR RELOCATE. Below is a progression of helpful tips that gain momentum towards relocating as the reader moves down the list.
- Existing structure(s) are less than 25 years old with several years of additional life remaining.
- The building engineering and technology infrastructure is functional with space and capacity to upgrade.
- Administrative and clinical space supports efficient and cost-effective operations and modern standards.
- There is room to increase the square footage of the user, either horizontally or vertically.
- Supportive partners or referral affiliates remain in place.
- The present facility offers greater opportunity than space located elsewhere.
- The facility is significantly dated and requires excessive capital to modernize with marginal potential return.
- Floor-to-ceiling heights are inadequate for modern ventilation requirements.
- Column spacing is too tight and inflexible for efficient space planning, particularly with planning of large diagnostic and treatment departments like imaging and surgery.
- Building systems such as HVAC and power are insufficient to support modern health care spaces with increased air changes and advanced imaging modalities.
- The facility has already been structurally maximized to remove inefficiencies.
- No contiguous real estate is available for key tenants expansion.
- The incremental growth of old business functions causes functional inefficiencies for coordination of new programs.
- Access to capital, rebranding initiatives, technology and/or increased market share will forward income generation.
For a dedicated list of factors for repurpose, redevelopment, renovation, relocation, replacement, expansion, purchase and lease representation of a medical building, contact MREA at 713.701.7900.