The Commercial Association of REALTORS® New Mexico is happy to announce that it has achieved the 4-Star Commercial Services Accreditation from the National Association of REALTORS®, by meeting 53 of the benchmarks. We join an elite group of associations to achieve this level of excellence among the approximately 1250 boards throughout the country.
These benchmarks developed by NAR represent key services, programs and products that benefit you, the commercial practitioner, while engaging members at a more committed level. Our Association has demonstrated the ability to meet the unique needs of commercial members and is being recognized as a leader of excellence.
The 4-Star Commercial Services Accreditation allows us to showcase the high level of services we provide to the community and our membership. Thank you for the time and hard work you have volunteered that assisted us in achieving such an honor.
Sincerely,
Kendra Yevoli
Executive Director
Archives for May 2019
Healthcare Clinics Become Sought-After Tenants at Shopping Centers
Shopping centers seek out healthcare tenants for longer leases and daytime traffic.
xpect to see more healthcare clinics in shopping centers, as landlords want to capture a piece of the growing healthcare industry to boost foot traffic and sales.
Today’s healthcare services in retail locations typically provide basic treatments, such as eye care, vaccinations and flu shots, routine health exams, preventive screenings and lab tests. However, additional and more intensive treatment services, including oncology and specialty care, chronic disease management and infusion services, are being considered for retail locations as well.
Today’s healthcare services in retail locations typically provide basic treatments, such as eye care, vaccinations and flu shots, routine health exams, preventive screenings and lab tests. However, additional and more intensive treatment services, including oncology and specialty care, chronic disease management and infusion services, are being considered for retail locations as well.
About 12,000 of the approximately 116,000 U.S. shopping centers already have a healthcare tenant, according to CoStar Group, a commercial real estate data provider. That figure is set to grow, according to Grant Gary, president of brokerage services with The Woodmont Company, a commercial real estate agency.
Higher acuity care, traditionally provided in hospital settings, is a growing opportunity in the retail environment, particularly as baby boomers age, according to research from real estate services firm JLL. The U.S. population over 65 years old is projected to more than double from 2015 to 2060, from 48 million to 105 million. This age group requires more higher acuity and frequent care and spends five times more on annual medical expenses than the average patient.
The cost to fully fit out a high-acuity level medical clinic, which might include the need for imaging and surgical equipment and/or emergency care services, varies, ranging from $350 to $500 per sq. ft., according to Matthew Coursen, senior managing director and Mid-Atlantic healthcare lead with JLL. More basic urgent and primary care clinics usually required $200 to $350 per sq. ft. Ultimately, pricing depends on the program, equipment, infrastructure requirements, construction labor and pricing fundamentals in each market.
Still, these medical clinics build-out costs exceed traditional retail build-out costs by around 40 to 50 percent, according to Grant Gary. Typically, landlords take on some mechanical, electrical or plumbing costs, but medical tenants pay around 75 percent of the total construction costs, notes Coursen.
However, medical clinics and doctor’s groups prefer to own their real estate. So, to incentivize clinics to shift from ownership to leasing, more of those build-out costs could be taken on by the landlords, according to Gary. But in no case do landlords cover half of the total cost required to fit out a medical clinic, says Coursen.
“It is normally the healthcare clinic. Where you can see the landlord participate is if the landlord is interested in bringing a healthcare clinic to the building,” says Craig Pryde, principal at KTGY, an international architecture firm. “The internal build-out of the tenant space is usually taken up by the healthcare provider.”
These high installation costs then translate into longer term leases, a benefit for landlords. Physician and hospital groups often also have high credit ratings than retailers, adding stability to the center’s tenant roaster, according to JLL research.
“From the landlord’s perspective, a healthcare tenant that is from a larger system would be a very valuable tenant in your retail building because it is essentially going to be an anchor tenant,” says Pryde. “It should provide continuity of revenue for a longer period of years. They generally tend to be creditworthy tenants. So, you’re not running the risk of leasing 10,000 square feet to a start-up or a smaller business venture that doesn’t have a large corporation behind them to guarantee them being an existence in three years.”
Healthcare clinics can operate successfully in any market tier, depending on factors such as existing supply of healthcare providers, demand for those services and population demographics, according to Gary and Coursen. For this reason, former bank branches can be desirable spaces for healthcare providers, as they tend to be in highly visible locations, often contain designated parking areas and are close to growing neighborhoods.
A healthcare tenant also brings patients and employees to the shopping center that may then frequent nearby stores and restaurants. More importantly, the healthcare clinic can provide more daytime traffic to the center, as opposed to restaurants, which bring in more evening customers, according to Gary.
The $3.5 trillion healthcare industry is estimated to grow by over 70 percent by 2027, according to the Centers for Medicare and Medicaid Services. The number of healthcare facilities grew from 351 in 2006 to an estimated 2,800 in 2017, with 47 percent growth in the last three years alone.
“I think the positives are much greater than the negatives in having [healthcare clinics] in retail centers,” says Pryde. “You’re bringing healthcare closer to the population, which is something that I think many healthcare systems are looking to do. They’re pushing the level of patient care closer to the population rather than trying to bring everybody to the hospital.”
By: Sebastian Obando (NREI)
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What the Future of PropTech Will Look Like
The next wave of proptech innovation will likely be aimed at modernizing aging buildings across major cities.
As the way we work, live, and play consistently changes, developers are now focused on creating properties that reflects the vision of how current and future generations will want to live.
“As real estate is finally catching up to other asset classes in technology adoption, we’ve noticed a recent spike in organizations that work as aggregators to bridge both data and offerings together into a single platform. This spreads across B2B and directly to the consumer,” says Mitchell Moinian, principal of The Moinian Group.
For example, The Moinian Group recently invested in a company called Moved that works as a digital moving concierge, providing services throughout the entire move-in and move-out process, including a tool that aggregates moving quotes from multiple vendors. This gives consumers the transparency needed to trust new innovations in what has historically been a very dated transaction, Moinian tells GlobeSt.com.
Another technology partnership Moinian has gravitated towards is Rhino, a company which provides financing solutions to what has historically been upfront costs such as security deposits, insurance, and lease guaranties.
“Rhino provides financing solutions on a month-to-month plan for security deposits. The company was created to get responsible tenants into the spaces they want to live in and work in. By reducing upfront costs and streamlining approvals, Rhino helps us get rentals off the market and happily occupied faster,” explains Moinian.
Moinian believes the biggest breakthroughs so far have been conceptual, programming, and information-related, focused on providing solutions for singular challenges.
“The next wave of proptech innovation will likely be aimed at modernizing aging buildings across major cities,” says Moinian. “The recently passed legislation in the Climate Mobilization Act will require heavy action on landlords to bring their buildings up to a strict standard starting as early as 2024. Proptech will continue to be key in enabling landlords to meet these new building standards and efficiencies.”
The Moinian Group holds a portfolio in excess of 20 million square feet, owning & operating properties across every asset category. To date, it has invested in 11 companies, Knotel, Nestio, Ollie, The Well, Rhino, inDinero, Moved, TF Living, OnSite IQ, ROCEAN & Paintzen.
By: Tanya Sterling (GlobeSt)
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SLIDESHOW: The Evolution of the Food Hall
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The food and beverage category continues to thrive in today’s retail climate. More and more consumers are dining out, which is increasing popularity among centers with sit-down and fast-casual restaurant tenants. Those thoughts are according to Richard Birdoff, principal and president of RD Management, who recently chatted with GlobeSt.com about all things retail. According to Birdoff, consumers enjoy the unique experiences many restaurants offer such as pop-up eateries and beer gardens, themed bars, food halls, and group dining events. “These ‘experiential’ food and beverage concepts draw patrons out of their homes, eager to capture shareable moments on their social media channels. Across the board, brick-and-mortar retailers that can provide an experience will continue to compete with online retailers and attract millennials and Generation Zers,” he said.
On the topic of food halls, Cushman & Wakefield’s Garrick Brown, VP of the Americas and head of retail research, recently also put out a food halls report, which said that what began as a trend that was largely relegated to just a few markets, has since exploded. When C&W first reported on the food hall movement, the concept was still in its infancy. At the time GlobeSt.com previously reported that food halls were largely divided into two basic camps; larger projects—often in historic, transit-oriented locales or smaller, mostly chef-driven concepts—almost all of which were located in Manhattan and just a handful of other American cities.
Brown’s report points out that “Just as consumer behavior, eCommerce and bricks-and-mortar retail are evolving at a breakneck pace, so too is the food hall movement.” In the report, he explores the most noteworthy trends in food hall development including expansion into different types of CRE, the impact of branding, space design, integrating entertainment elements and much more.
“When we first began tracking this phenomena in 2016, there were roughly 120 projects across the country. That number is on track to nearly quadruple, with 450 food halls expected to be operational throughout the US,” he says. “By the end of 2020. At a time when headlines about the retail sector remain dominated by stories of closures and bankruptcies, food halls have emerged as one of the hottest growth trends.”
Malls, college campuses and suburban office campuses are currently seeing action with a new roster of players emerging beyond the chef-driven concepts and handful of food hall venue operators that largely pioneered this movement, Brown says. “Meanwhile, the drive to offer heightened experiences for consumers is also intensifying.”
Take a look at the details slideshow above for some key research from the Cushman & Wakefield food hall report.
By: Natalie Dolce (GlobeSt)
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