A few months ago, I watched a med spa owner walk away from a traditional medical office building lease. $55 per square foot, buried in a hospital campus with terrible parking, 3-year term. Two weeks later, she signed a 10-year lease in a former retail space on a main road for $42 per square foot, with the landlord covering half the build-out costs.

Same market. Same square footage. Completely different outcome.

Here’s what’s happening: the wellness industry just hit $6.3 trillion globally, growing at 9% annually. By 2029, it’ll be pushing $10 trillion. Every one of those businesses needs physical space. Med spas. PT clinics. Chiropractic offices. IV therapy centers. Functional medicine practices. Mental health clinics.

And landlords are finally waking up to what I’ve known for 26 years working in healthcare: your business model is exactly what they need.

You sign long leases. You invest heavily in your space. You’re recession-resistant. You drive consistent foot traffic. You’re credit-worthy.

So if you’re still overpaying for cramped medical office space with bad parking and short lease terms, this is the shift you need to understand. Right now, you have leverage. Most wellness providers don’t even know it.

Traditional retail is dying. E-commerce crushed it. Foot traffic is down. Lease terms are short because tenants bail constantly.

Landlords are sitting on vacant strip malls, empty big-box stores, and underperforming retail centers. They’re desperate for stable, long-term tenants.

That’s you.

Here’s what makes wellness businesses different from traditional retail, and why landlords are starting to fight over you.

You sign long leases. Most wellness practices sign 7-15 year leases, and corporate-backed fitness concepts sign 15-20 year leases. Why? Once you invest $350-$800 per square foot in specialized build-outs (plumbing for IV suites, HVAC for clinical spaces, equipment for diagnostics), moving becomes insanely expensive. You’re locked in. Landlords love that stability.

You’re recession-proof. Wellness services like physical therapy, mental health, chiropractic care, and primary care are essential services. People don’t stop going to their therapist or their PT because the economy dips. During 2008 and COVID, wellness spending held steady while discretionary retail collapsed. Landlords know this now.

You’re credit-worthy. If you’re part of a franchise system, a DSO (dental service organization), or backed by private equity, you’re considered institutional-grade. That means landlords can structure deals using Credit Tenant Loan principles, where they’re underwriting your credit, not just the property. That’s huge for them.

You drive traffic. Research shows that wellness tenants increase foot traffic and lead to an 18% increase in credit card spending across the entire property. You’re not just a tenant. You’re an anchor that makes the whole property more valuable.

So here’s the reality: landlords need you. When you understand that, you negotiate from strength.

I know what you’re thinking. “Retail space? That’s not designed for healthcare.”

You’re right. It’s not. But that’s actually your advantage.

Most brokers will steer you toward traditional medical office buildings. They’ll tell you it’s “turnkey” and “designed for healthcare.” What they won’t tell you is that MOBs (medical office buildings) are often overpriced, poorly located, and designed for hospital-based care models that don’t fit your business.

I’ve watched too many wellness providers sign MOB leases and regret it six months later. Here’s why vacant retail is often a better option.

Location. Retail space is on main roads with high visibility, easy access, and tons of parking. Traditional MOBs? They’re usually tucked into hospital campuses with confusing layouts and terrible parking. Your patients want convenience. Retail wins every time.

Cost. Landlords with vacant retail are motivated. They’ve been sitting on empty space for months (or years), and they’re bleeding money. That gives you negotiating power. You can often get rent concessions, tenant improvement allowances (money the landlord gives you to customize the space), and longer lease terms because they need you more than you need them.

Flexibility. Retail spaces give you layout flexibility that cookie-cutter MOBs don’t. You can design your patient flow, your treatment rooms, your reception area exactly how you want it. You’re not stuck with someone else’s outdated floor plan.

Speed. Converting retail space skips the 9-18 month nightmare of getting approvals for new construction. You get to market faster, which means you start generating revenue sooner.

Branding. Retail locations let you control your brand experience. You’re not just another suite number in a sterile medical building. You’re a destination. That matters for patient acquisition and retention.

Now, I’m not saying it’s plug-and-play. Converting retail to healthcare requires serious infrastructure upgrades: HVAC, plumbing, electrical, acoustics. But if you know what you’re doing (or you work with someone who does), the economics work in your favor.

Most wellness providers don’t know how to talk to landlords about their space requirements. So they end up accepting whatever’s offered, and overpaying for it.

Here’s what you actually need, broken down by business type.

Med Spas & Aesthetic Practices: You need specialized electrical for lasers and diagnostic equipment, robust plumbing for multiple sinks and treatment rooms, private consultation rooms, and medical waste protocols. Your build-out costs will run $350-$800 per square foot, but you’re a high-margin business that can support premium rent, which gives you leverage to negotiate tenant improvement allowances.

Physical Therapy & Chiropractic Clinics: You need open treatment areas with privacy partitions, specialized flooring, and equipment storage. Your space requirements are less complex than med spas, which means your build-out costs are lower, but you still sign long leases, which landlords value.

IV Therapy & Longevity Clinics: You need clinical-grade plumbing, private infusion bays, medical refrigeration, and waste management. You’re essentially a hybrid between retail and clinical space. Your build-out is expensive, but your patient base is sticky and your revenue per square foot is high.

Mental Health & Integrated Wellness Centers: You need layouts that balance patient privacy with clinician collaboration. Soundproofing is critical. HIPAA-compliant design is non-negotiable. But your operational costs are lower than equipment-heavy practices, and you’re an essential service, which makes you extremely attractive to landlords.

Functional Medicine & Primary Care: You need clinical infrastructure (HVAC, plumbing, electrical), but you’re the “medtail” category (medical + retail) that landlords are actively recruiting. You’re essential, non-discretionary, and driven by an aging population. You have serious leverage.

Here’s where most wellness providers get burned. They sign a lease without understanding their true build-out costs, and six months later they’re over budget and scrambling for capital.

Standard retail build-outs run $100-$200 per square foot. Healthcare build-outs? $350-$800 per square foot.

Here’s why.

HVAC: Retail HVAC is designed for open floor plans. Healthcare spaces need zoned systems for partitioned layouts, high indoor air quality, and specialized ventilation for clinical areas. You’re often replacing the entire system.

Plumbing: Healthcare requires way more plumbing. Hand wash stations. Medical equipment. Clinical fixtures. If you’re running an IV therapy clinic or med spa, you’re re-piping the whole space.

Electrical: Clinical spaces need dedicated circuits for specialized equipment, backup generators for life-safety systems, and robust IT infrastructure for telemedicine and EHR systems. Standard retail electrical doesn’t cut it.

Acoustics: HIPAA compliance requires confidentiality. That means sound dampening, white noise systems, and secure partitions, none of which exist in standard retail.

I had a client who signed a lease for a former boutique clothing store without getting a contractor to walk the space first. She budgeted $200K for build-out. Final cost? $480K. She nearly went under before opening her doors. Don’t let that be you.

So how do you make this work financially?

Know your numbers before you start looking. Before you tour a single property, sit down with your general contractor and architect. Get preliminary cost estimates based on your specific business type. Understand what your build-out will actually cost. Know what you can realistically afford. Walking into lease negotiations with a clear budget eliminates wasted time, prevents expensive surprises, and keeps you from falling in love with a space you can't actually afford to build out.

Negotiate tenant improvement allowances. Landlords with vacant space are motivated. Push for $50-$150 per square foot in TI allowances.If they won’t budge, negotiate free rent during construction.

Sign a longer lease. If you’re willing to commit to 10-15 years, landlords will invest more upfront because they’re amortizing that cost over a longer revenue stream.

Structure it as a triple net lease. Many wellness practices, especially franchise concepts, sign NNN leases (triple net: you cover property taxes, insurance, and maintenance). That reduces the landlord’s operational risk, which gives you leverage to negotiate lower base rent.

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Here’s something I keep telling wellness providers: you’re stronger together.

When you co-locate with complementary wellness businesses (say, a PT clinic next to a med spa, next to a mental health center, next to a healthy cafe), you create a wellness destination. Patients coming for PT might book a massage. Mental health clients might grab a smoothie. Med spa clients might schedule a chiropractic adjustment.

Research shows that wellness tenants drive an 18% increase in average spending across the property. You’re not just benefiting the landlord. You’re benefiting each other.

I worked on a project a few years ago where we converted a dying strip mall into a wellness hub. PT clinic. Yoga studio. Acupuncture. Juice bar. Within 18 months, the landlord’s NOI (net operating income) doubled, and every tenant saw a 30-40% increase in patient volume compared to their previous standalone locations. That’s the power of co-location.

And here’s the operational win: by mixing clinic-based practices (9-to-5 traffic) with fitness and lifestyle tenants (early morning and evening traffic), you smooth out parking congestion and maximize space utilization throughout the day. That makes the entire property more valuable, and gives you leverage when negotiating lease renewals.

So here’s what this all means for you.

Stop defaulting to traditional medical office buildings. They’re expensive, poorly located, and designed for hospital-based care models that don’t fit your business. Retail space gives you better visibility, better access, and better economics, if you know how to structure the deal.

Understand your leverage. Landlords need long-term, stable, recession-resistant tenants. That’s you. Don’t negotiate like you’re doing them a favor by renting their space. You are the solution to their problem.

Know your build-out costs. If you walk into a lease negotiation without understanding your infrastructure requirements, you’ll get stuck with a landlord who underfunds your TI allowance and leaves you holding the bag. Do your homework. Get a contractor to walk the space before you sign anything.

Think long-term. If you’re planning to scale (open multiple locations, franchise, or sell to private equity), your real estate strategy matters. Long-term leases in high-visibility retail locations are assets. Short-term leases in hidden MOBs are liabilities.

Co-locate strategically. If you’re opening a new location, look for properties that already have complementary wellness tenants. You’ll benefit from shared traffic, and landlords will give you better terms because you’re strengthening their tenant mix.

I’ve spent 26 years in the healthcare industry, and I’ve seen this cycle play out over and over. The providers who understand real estate strategy scale faster, pay less, and build more valuable businesses. The ones who don’t end up stuck in bad leases that drain their cash flow and limit their growth.

Finding the right location takes serious research: tracking vacancy rates, analyzing traffic patterns, understanding landlord motivations. The providers winning right now are using AI to automate the grunt work so they can focus on patient care and business growth.

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The wellness industry is a $6.3 trillion economy growing at 9% annually. Wellness real estate is projected to grow at 15-18% per year through 2029. You have leverage right now. Landlords are desperate to fill vacant retail with stable, long-term tenants. Your business model (long leases, recession-resistant services, high-margin operations) is exactly what they need.

But most wellness providers don’t know how to negotiate from strength. They don’t understand their infrastructure requirements. They don’t know what TI allowances to ask for. They don’t realize that retail space is often a better option than traditional medical office buildings.

That’s where I come in.

I’m offering complimentary site selection consultations for health and wellness businesses looking to open or expand.

Whether you’re a med spa, PT clinic, chiropractor, functional medicine practice, or franchise buyer, I’ll help you:

✅ Find locations with high visibility, easy access, and strong demographics

✅ Understand your true build-out costs before you sign a lease

✅ Negotiate TI allowances, rent concessions, and favorable lease terms

✅ Structure deals that protect your cash flow and support your growth

After 26 years in healthcare, I know the operational pressures you face, the financial metrics that matter, and the site-level decisions that can make or break your growth. I know where you have leverage, what landlords will really move on, and how to design a deal that supports your future—not just your first year.

Your property should be a profit engine, not a bottleneck.

📞 Book a complimentary strategy session

🔗 Connect with me on LinkedIn

The Next Gen Dev is your weekly briefing on the strategies and frameworks that separate wellness businesses building the future from those stuck in the past.

Know a wellness provider who’s looking for space or stuck in a bad lease? Forward this email.