The Rise of “Medtail” Space

What is medtail and why are we writing about it? Honestly, when we first saw this word in writing, we had to Google it. This new buzzword refers to a medical or healthcare tenant occupying space in what has traditionally been a retail environment. If you pay close attention, there’s a good chance you’ve seen these new alternative ‘stores’ pop up in your local shopping center. Over the past few years, Healthcare clinics have been opening in strip malls across the country, but the COVID pandemic has kicked things into overdrive, bringing this emergent trend front and center.

“COVID-19 has sped up the inevitability that preventative wellness is no longer a choice,” said Willie Hoag, principal at Tether Advisors, in their recently issued 2021 Retail Healthcare Outlook study. “The retail space is overbuilt, mediocre and redundant…It’s exciting that a new group of players is filling former retail spots while providing access and convenience to consumers.”  

It is no secret that landlords of traditional retail products are seeking innovative solutions to fill an excess of vacant space. Landlords realize that certain healthcare tenants can be attractive based on strong credit and often sign long term leases. Given continued softness in the retail market, there is a general willingness to be more creative with uses and more flexible on terms. While zoning, access and build-out costs remain prevailing considerations, many retail-oriented locations offer tenants exclusive control of their space, and therefore the ability to adapt operationally and accommodate the needs of their patient-base.

Sounds like a win-win situation for many communities, especially busy consumers who can combine a quick trip to the doctor with the convenience of that Starbucks latte and long-overdue run to the dry cleaners!