WASHINGTON, DC—Not only medical office buildings benefit from strong healthcare economics, DTZ says in a new report on the healthcare sector's vitality. Retail, office and industrial also enjoy opportunities for growth due to changing dynamics in the sector.

“Most trends in healthcare—including where and how patients are treated—will have a direct bearing on the development, leasing and management of real estate assets that facilitate the optimal delivery of healthcare services,” says Lorie Damon, DTZ managing director and leader of the firm's national healthcare practice. “It is undeniable that the business of healthcare will remain as dynamic as the challenges facing it.”

Retail is seeing the impact of those dynamics. DTZ's report notes that as hospitals work to increase market share and attract new patients by establishing a more convenient presence, “many are embracing a retail-like mindset through implementation of a 'hub-and-spoke' delivery model, with hospitals serving as the hub and satellite offices increasing their footprint.”

The growth of outpatient facilities such as imaging, oncology and obstetrics-gynecology centers illustrates this principle in action. “The lower cost of establishing off-campus locations allows hospitals to add patients while spending relatively less on space,” the report states. 

Furthermore, according to the report, “As healthcare providers expand into desirable communities, they're finding willing retail landlords. For providers, the shopping centers offer convenient and affordable locations as well as desirable foot traffic.”

Retail health clinics represent another healthcare trend gaining momentum. Increasingly, DTZ says, “patients are choosing retail clinics for care instead of traditional hospital and physician practice services due to their cost and convenience.” They're also looking for healthcare models that mirror their experiences in banking, retail and entertainment.  

Healthcare-related tenants are have found their way into traditional office parks, and not only physician groups. DTZ sees the migration of back-office healthcare administration functions—to include accounting, procurement, information technology and communications—from their traditional hospital campus setting as aiding the multi-tenant office market's recovery.

“Support services moving off-campus also opens up space on-campus to accommodate an increase in co-location: the dynamic pairing of clinical research and development with critical care on the same hospital campus,” the report states. “Close physical proximity of R&D with critical care lends itself to improvements in both while increasing the attractiveness of the hospitals for the best medical minds.” 

DTZ says traditional industrial assets and parks have also benefited from the structural changes that are underway in healthcare. To achieve significant operational savings, “many healthcare systems are engaging in supply chain overhaul, and with that effort, are working to ensure that their distribution and logistics management strategies and assets are aligned to provide the most cost-effective, sustainable solutions in a new era of outcomes-based reimbursement.”

The report notes that the average hospital carries 6,000 to 8,000 SKUs of in-house inventory at any one time, but it may “own,” and thus warehouse and distribute, as many as 35,000 SKUs end-to-end. Accordingly, supply chain costs can consume as much as 40% of total operating budgets, which rank second only to labor as the largest expense for hospitals. 

“Even small improvements in supply chain performance can translate into tremendous bottom-line savings,' according to the report. This dynamic favors third-party logistics providers that can offer inventory management, cold-chain logistics, just-in-time deliveries for healthcare providers with limited on-site storage space and home-healthcare deliveries to residential settings.