The medtail sector is becoming an increasingly important source of tenants for landlords seeking to backfill second-generation space. Operators want to move their businesses as close to their customers as possible, and landlords need a reliable source of regular traffic.

The most recent example is at Urban Edge Properties’ Outlets at Montehiedra, in San Juan, Puerto Rico, pictured at top. Urology Hub, the Caribbean’s largest urology center, will open alongside a Ralphs supermarket in a former Kmart and will fill a local need for well-respected doctors and medical services.

Medtailers are taking advantage of high vacancies in office and retail properties to snap up convenient locations to better serve customers, who are becoming better insured and able to afford more services, according to Colliers. In the U.S., 32 enclosed malls house healthcare services, according to Colliers. About one-third of those tenants were added after the pandemic, according to the firm. Healthcare users have taken more than 36 million square feet of retail space in the past five years, at an average deal size of 3,894 square feet, according to Colliers national director of Retail Services Anjee Solanki.

Urgent care facilities are among the most prolific expanders. A host of national and regional chains are looking for space. Representatives from such medtail tenants as One Medical and NAO Medical attended the recent ICSC@New England conference to look for locations.

“We do not locate in medical campuses,” said One Medical senior real estate manager Rachel Seeman. “We like to co-locate where our members live, work and play.” The company has 200 locations in 20 markets. “Landlords view us as an amenity because we put a lot of resources into our buildouts.”

NAO Medical director of new business Wayland Benbow said: “We’re going to roll out national, build a lot of stores.” In NAO Medical’s concierge medical service, members can visit the office, have a virtual appointment or get a house call. It has 13 locations and is looking to open new inline and freestanding medical offices throughout the Northeast. “We have in-house labs, and that’s a big differentiator in this field” he said.

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