Hospitals follow rooftops, move to suburban areas

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Commercial real estate professionals are seeing trends that medical offices are moving away from larger complexes and seizing retail space in growing suburban communities.

While campuses like downtown’s medical district aren’t going anywhere, they’re also starting to max out on space, said David Grubbs of NAI Charleston, a commercial brokerage firm. The limited room for expansion, combined with patients’ increasing demands for easier access, hassle-free parking and more convenient office locations as populations move farther outward are leading the way for a shift.

“What we’re seeing now, which is good for commercial properties, is that while we have lost retail centers, physicians’ offices can backfill that,” he said.

MUSC’s expansion into the vacant J.C. Penney store at the Citadel Mall is an example. The West Ashley Medical Pavilion provides family medicine, COVID-19 screening and other services, with nearby access to Interstate 526, Savannah Highway and Charleston Area Regional Transportation Authority bus stops, ample parking and an easily identifiable location in the landmark shopping center.

MUSC also plans to create a facility on Seabrook Island Road on Johns Island to add emergency health care options for the community.

Having developed medical office space specifically for physicians over 15 years, Grubbs is always looking to see what a retail or commercial building can be repurposed for, adding that empty spaces like former Blockbuster storefronts are great locations since they’re central to everything.

Reid Davis, managing principal of Lee & Associates, said a majority of the medical office spaces he has available for lease right now are in growing suburban markets.

“Office leasing is now a little different because we’ve seen an uptick on the medical side,” Davis said.

Spaces include new construction on Daniel Island and the recently developed Nexton medical office building, which is situated in the heart of the evolving mixed-use community in Summerville.

Current tenants of the Nexton medical office building include a plastic surgeon, an orthopedist, a cardiologist and primary care physicians, which Grubbs said aligns with the current trend toward clusters of multispecialties miles from the closest hospital.

Davis pointed out other office spaces, including West Ashley’s Truluck Center that was recently developed on St. Andrews Boulevard next to restaurants, a CVS and a Doctor’s Care, as well as downtown’s WestEdge.

As medical tenants breed more medical tenants, Cameron Yost, an associate at Lee & Associates Charleston, said landlords are seeking complementary uses in buildings, which will help promote a strong referral system between the practices.

“The vision for buildings like Nexton’s is to have everyone all under one roof with a great referral network,” Yost said.

Having an office setup within a community is also prime advertising, Grubbs said. People moving from other markets or those who don’t already have a particular doctor see an office next to their new home and often choose that physician out of convenience.

“With some of these properties, it provides doctors opportunities to care for people in convenient locations so that they can reach a broader group,” Yost said.