PHOENIX—More than 400 attended the 2014 RealShare Healthcare Real Estate conference held at the Phoenician in Scottsdale where Kate Morris, first vice president, CBRE, moderated the panel: New Trends in Marketing and Leasing. Joining her as panelists were John Wadsworth, vice president, Irvine and national director, Healthcare Services Group, Colliers International; Mike Noto, senior vice president, Management Services Group, Health Care REIT; and Julie Johnson, executive vice president, GPE Commercial Advisors.

Johnson said this is the year of implementation. “After the Affordable Care Act, people knew how it would affect their practices, but people still need real estate—now they've started taking action steps.”

“It's been active on the acquisition front,” said Noto. “2014 is the year to sell. As technology advances, we're seeing more of a move out of hospitals and into MOBs.”

“As the trend of consolidation ensues,” said Wadsworth, “the evolution of the tenant continues. The lifeblood is the tenant. The tenant has evolved significantly because the consumer wants better access, visibility and convenience.”

Johnson said providers are looking for visibility because they have branding needs. This leads them to lease different types of spaces. One major Phoenix mall, for example, has a 70,000-square-foot medical tenant.

“Thin margins are getting thinner, so you can't afford to mess up on a real estate deal. Product will become obsolete pretty soon. The medical community wants larger blocks of space to operate more efficiently.”

“You've got to have a good architect and take a look at spaces to create 5,000-plus square foot spaces. You've got to update common areas and signage, and maybe consider timeshare suites,” said Johnson. ”The retail model is here to stay.”

Wadsworth agreed with Johnson and stated, “It's consumer centric. Leasing non-traditional spaces has to continue.”

“Those that are progressive thinkers, to them, real estate is a strategy and retail is a great way to do it,” said Noto. “A repurposed grocery store is a good example. Old Walmart locations are great, they have good visibility. We've seen hospital-sponsored projects like this.”

Wadsworth said if the medical community is not talking about post-acute strategy, they should be. “There needs to be expansion of post-acute care. It's a great opportunity to reposition a piece of real estate,” he said.

“Seven years ago, the average medical office was 2,300 square feet; today it's 40,000. The leasing process is taking much longer,” said Noto. “There is more red lining and more conversations back and forth during the leasing process.”

Noto agreed: “Deals are getting more scrutinized, taking longer.”

Morris added, “Landlords who are not used to healthcare real estate can be difficult; you have to do a lot of educating.”

“With reimbursements being capped, healthcare systems are looking for savings and huge part of that is real estate,” said Noto.