Among the many key takeaways in this detailed analysis, is the resilience of healthcare businesses, particularly during economic downturns. The expansion of healthcare services into high-traffic retail centers has also significantly bolstered the sector's appeal.

This article, which examines why now is a good time to invest in healthcare retail, is written by US-based Curtis Frost, the CEO of Workman Management Group, a single-family office providing management, advisement and investing expertise across an array of investment strategies with a focus on commercial real estate development. Those who wish to respond with comments can email: tom.burroughes@wealthbriefing.com. Comments of guest contributors are not necessarily endorsed by the editorial team.

Raised in an entrepreneurial household, I gained invaluable insights on the retail sector at a young age. My parents owned and managed multiple grocery store locations, I became immersed in hands-on experience including daily discussions on business strategies and operational improvements. This early exposure was the foundation of my business acumen and it highlighted the importance of thinking like an owner.

Today, as the head of Workman Management Group, a single-family office, I oversee a wide range of investment activity including a nationwide real estate development company that grew alongside of the nation’s leading dental support organization, Heartland Dental.

Having WMG deliver over 250 of the 650+ DeNovo dental locations since 2011, I reflect on the path we’ve taken in integrating healthcare into high-traffic retail centers over the past decade. Long before it became a mainstream trend, Dr Workman recognized the unique investment potential of healthcare retail. Integrating healthcare retail, whether through real estate or direct investment, presents a compelling and strategic opportunity within diversified portfolios, particularly for family offices.

Enhancing business success through innovative growth strategies
Consistency in healthcare provider presence is crucial for sustainable success. For instance, Dr Workman expanded dental offices in underserved areas with advanced technology, then shifted to high-traffic retail locations such as grocery stores, enhancing accessibility and convenience. Similarly, Heartland Dental grew by affiliating with established practices some of which relocated to grocery-anchored environments, which boosted patient engagement by integrating dental care into daily routines. These strategies not only expanded brand presence but also met patient needs seamlessly, resulting in higher treatment acceptance rates and overall productivity.

The importance of environmental immersion
One of the foundational principles in healthcare retail investment is environmental immersion. The adage never invest in something you don’t understand; holds true in many contexts and healthcare retail demands a thorough immersion in the investment environment.

In healthcare, the provider plays a pivotal role in operational results, so it is important to understand the dynamics at play. Key considerations include their long-term commitment, establishment duration, and whether they operate as a single-provider or multi-provider practice. Additionally, evaluating the emotional and behavioral dynamics between consumers (patients) and providers and their teams is crucial to the overall patient experience.

Investing in healthcare retail also goes beyond financial analysis; it requires a real understanding of industry specifics whether it be dental, veterinary, urgent care, physical therapy, chiropractic services and so forth. Each sector has unique dynamics that must be grasped before making investment decisions, whether in operational businesses or associated real estate.

Adding value through existing business structures
Investing in the existing business structure should be the primary focus when seeking to add value. Opportunities for value enhancement exist in various forms, and achieving critical mass can lead to significant cost savings across the profit and loss statement. For example, increased volume can result in supplier discounts and improved negotiation power for reimbursement rates with insurers.

In urgent care facilities, deficiencies in medical imaging equipment often necessitate referrals. However, if integrating with larger networks that adopt advanced technologies, healthcare providers can prioritize delivering excellent care while investing in researching new technologies thereby staying at the forefront of patient care advancements.

By integrating with larger networks that adopt advanced technologies, such as low radiation handheld devices from companies like Oxos, for example, providers can enhance patient care and expand their service offerings. This integration also allows for better utilization of office space, eliminating the need for treatment rooms dedicated to bulky imaging equipment.

Aligning investment strategy with objectives
Tailoring the right investment strategy to align with specific objectives is crucial for investors. For those seeking diversification, investing in larger groups through private equity funds can offer advantages. Those seeking opportunities to apply leverage or have the option for near term liquidities may prefer exposure through real estate leased by various healthcare businesses.

An important consideration is the resilience of healthcare businesses, particularly during economic downturns. Veterinary services for large animals, for example, tend to be less affected by economic shifts compared to discretionary spending on small animal care. Human healthcare also shows similar patterns of resilience. Despite economic conditions, demand remains steady for treatments like chiropractic adjustments and dental care. Urgent care centers also experience consistent demand, especially during active periods such as summer when injuries among children increase.

Ultimately, whether investing in a network of healthcare providers or individual high-potential locations, the decision should reflect the investor's specific goals and the unique dynamics of that healthcare sector. Recognizing seasonality is also crucial, with trends like increased utilization during insurance renewal periods and heightened summer activity reinforcing the sectors stability and resilience.

Seizing opportunities and finding solution-driven approaches
Seizing opportunities begins with selecting a sector that is attractive for investment. Healthcare stands out not only for its resilience but also for several factors contributing to its current allure. The expansion of healthcare services into retail settings has significantly bolstered the sector's appeal. A notable trend has been the migration of pharmacies and other healthcare services into retail spaces, pioneered by companies like Walgreens. This evolution has made investments in healthcare real estate particularly enticing. Retail settings enhance the asset’s flexibility for future repurposing and attract new providers seeking entry despite the substantial capital investment required.

On the operational front, varying state regulatory landscapes influence direct investment in healthcare businesses, but recent regulatory adjustments have spurred care advancements. For instance, in Florida, the elimination of the certificate of need process for hospital construction has expedited healthcare facility development, better meeting the needs of expanding populations. These regional regulatory adaptations present significant investment opportunities within the healthcare sector.

Achieving excellence by solving complex problems is a challenging endeavor that requires patience and intuition to seize opportunities for growth. The transformation of closed banks into efficient dental offices, for example, exemplifies this approach. At Heartland Dental, this initiative leveraged well-sized assets with minimal conversion requirements and yielded significant gains.

Innovation is fundamental to success in this strategy. Embracing diverse approaches, such as advanced technology and demographic modeling, for example, aligns investments with stakeholder objectives, driving substantial growth. During the pandemic, disruptive supply chain issues prompted the establishment of a dedicated sub-department for our company. This team creatively sourced component parts from unconventional outlets like eBay, for example, ensuring prompt office openings and minimal patient rescheduling after reassembly at headquarters. This approach avoided reliance on singular strategies and fosters an entrepreneurial mindset, continuously exploring opportunities for improvement.

What succeeds today will require enhancement tomorrow, prompting ongoing advancement and raising standards. To achieve sustained excellence, redefining benchmarks and maintaining growth through proactive investment strategies are crucial.

Overall, healthcare retail represents a flourishing frontier driven by innovative solutions and adaptive strategies, exemplified by transformations like those undertaken by Heartland Dental. Embracing this trend promises not only significant gains, but also the opportunity to redefine standards in patient care delivery.