A hospital chain will be opening an outpatient facility at a large vacant Sears anchor store in New Jersey, another example of healthcare providers becoming a growing category of mall tenants.
Cooper University Health Care is taking more than 165,000 square feet at the former department store site at Moorestown Mall, which is located outside Philadelphia in Moorestown, New Jersey. Pennsylvania Real Estate Investment Trust, headquartered in the City of Brotherly Love, owns and is repositioning that retail center.
In January, PREIT, which emerged from Chapter 11proceedings in December, said it was redeveloping Moorestown Mall and had approval to add about 1,000 apartment units as well as a hotel to its Garden State property. Like landlords across the country, the real estate investment trust is looking to create foot traffic and fill vacancies at its malls by adding nontraditional tenants, as brick-and-mortar sites are still reeling from the double punch of the coronavirus and the continuing escalation of online ordering. A record number of stores closed last year.
Heathcare, in its various forms, is a rising opportunity for mall landlords. For example, vacant Sears stores across the nation are being used as temporary mega coronavirus vaccine centers. On a more permanent basis, because of the aging U.S. population, healthcare providers are opening more locations — walk-in clinics, outpatient care and testing, rehab facilities and actual hospitals .
This intersection of retail and healthcare has been dubbed “medtail.”
PREIT Chairman and CEO Joe Coradino announced his company and Cooper University Health had executed a transaction for the outpatient location at the Moorestown Sears last week in a fourth-quarter earnings report. The CEO didn’t specify if Cooper University Health was leasing the vacant Sears, which closed roughly a year ago, or buying it.
“With this addition and the apartments and hotel plan for the site, the property will further evolve its mix to create a one-stop hub, including dining, entertainment, fitness, a broad array of retail options and now a premier outpatient healthcare facility,” Coradino told Wall Street analysts on a conference call.
Cooper University Health Care has the only state-designated Level I trauma center in South Jersey and is home to MD Anderson Cancer Center at Cooper and the Children’s Regional Hospital at Cooper. It also has a network of more than 100 medical offices and four urgent-care centers throughout the region.
Where Patients Live, Work
“More residents continue to place their trust in Cooper University Health Care, as the leading academic health system in the region,” the healthcare provider said in a statement. “With more than 1.6 million patient visits annually and over 100 locations throughout southern New jersey, Cooper is acquiring this additional office space to meet consumer demand for our expert specialists. The building formerly used by Sears at Moorestown Mall is a perfect location in close proximity to where many of our patients live and work.”
PREIT is reconfiguring and retenanting a number of its malls. The Moorestown Mall redevelopment is part of the company’s national strategy to add thousands of multifamily units to its malls.
“The PREIT team, and portfolio, proved to be resilient as we navigated uncertain terrain,” Coradino said in a statement on fourth-quarter earnings.
“Our targeted strategy of dispositions and anchor replacements over the past several years created a real estate portfolio of bulls-eye locations in high barrier-to-entry markets that stands the test of time,” he said. “Our portfolio is comprised of a differentiated mix of uses that attracts robust demand from a variety of non-retail uses, strengthening the company and fortifying our revenue stream. At the same time, we are well-positioned for a strong return to brick-and-mortar shopping and leisure as restrictions ease and vaccinations continue.”
PREIT was one of the first U.S. retail property owners to file for Chapter 11 bankruptcy protection during the COVID-19 outbreak. It came out of the proceedings after forging an agreement with Strategic Value Partners.*Article courtesy of CoStar
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