Five Takeaways Mike Neuser

5 Takeaways from the Virtual InterFace Healthcare Real Estate Conference

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Wold Team

Interface Conference Group recently hosted its virtual InterFace Healthcare Real Estate conference, which featured seven timely discussions and valuable insights into the future of the healthcare and medical office real estate industries.

Panelists discussed the ongoing impact of the pandemic on hospital and system real estate usage as well as what to expect post-Covid. They shared statistics and commentary on the investment, development, financing and leasing markets and predictions on where the ‘retailization’ of healthcare real estate is headed next.

While there were many applicable takeaways from these discussions, below are five of the most salient learnings. From the resilience of the industry to the future of patient-centric healthcare, those of us working in the healthcare and medical office real estate industry can expect a bright future ahead.

1. The outlook and demand for future development in healthcare real estate is strong.

Panelists acknowledged that there was a slight pause in 2020 due to the pandemic, with healthcare providers shutting down some activities like elective procedures in order to conserve capital. Many of the speakers believe there's a strong, national rebound ahead, though, especially in the Southeast. As projects move forward, 2021 is shaping up to be one of the most active in history with demand expected to stay high over the next 10-15 years for hospitals, ASCs and MOBs.

2. While telehealth visits grew in popularity during the pandemic, in-person doctor visits will still be the primary point of access for patients.

At the beginning of the pandemic, telehealth services skyrocketed and have increased in popularity due to their ability to continue to engage patients. The panelists collectively determined telehealth is here to stay, but going to the doctor in person is still considered the primary access for patients. Telehealth services will now add efficiency and additional outreach to already thriving healthcare systems.

3. Owners can mitigate construction cost increases by locking in pricing as early as possible.

Although construction costs are rising up to 20-25%, panelists agreed it’s not a surprise. Materials costs have been increasing, especially lumber and steel, but the current labor shortage with fewer contractors and subcontractors available is also driving up costs. The panelists agreed that the sudden cost increases have slowed some projects, but the demand for healthcare space is still strong.

4. The pandemic will affect the design of future clinics.

Panelists agreed that clinic designs prioritized efficiency prior to the pandemic, but more changes will be made to help prepare for the next potential pandemic or other unforeseen circumstance that demands mitigation of disease spread. While safe, modern and high-tech designs will dominate, an added emphasis will be placed on enhanced infection control and telemedicine. Hospitals of the future will have space for triage, COVID units and negative air pressure wings.

5. Mission and purpose are paramount when partnering with an architecture and design firm.

One of the most important aspects of hiring an architecture and design firm rests on their purpose and overall mission. Although innovative designs and unique solutions are important differentiators, most panelists agreed that strong relationships matter most. The ability to skillfully communicate processes and answer questions in a timely manner will always be a top priority.

We are fortunate to work with many clients across the healthcare and medical office real estate industry and will continue to apply new insights to ensure we bring their goals forward in every project.

Michael Neuser is the Director of Client Engagement at Wold | HFR Design. He can be reached at mneuser@woldhfr.com.

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