Empowering Doctors as Entrepreneurs: Investing in Medical Real Estate For Your Practice

Healthcare is always evolving. For private practice doctors to maximize their careers, they must stay aware of new opportunities, new trends in the industry, and new ways to work. Since COVID-19, the concept of “medtail” — where healthcare services and the convenience of retail intertwine, has surged in popularity. 

So, what exactly is medtail, why is it becoming increasingly popular, and how can private practice providers with entrepreneurial ambitions take advantage of medtail? Let’s dive in. 

The Entrepreneurial Doctor

In the healthcare industry, it’s no secret that private practice doctors are less common than they used to be. According to the AMA, between 2012 and 2022 the share of physicians who work in private practices dropped 13 percent, from 60.1% to 46.7%.

There are a wide variety of issues with the general shift from independent doctors to corporate-owned practices but the most telling may be that the majority of patients with a preference prefer an independent practice. It’s not surprising as independent practices typically have better patient outcomes, lower-per-patient costs, fewer preventable hospital admissions, and fewer readmissions according to Statnews. 

Why are so many doctors forgoing independent practices? According to the same survey by the AMA, many physicians are moving into corporate-owned health systems because they don’t want to deal with negotiating the payment side of owning a practice.

While negotiating higher payment rates can be a task some providers struggle with, the benefits of owning an independent practice far outweigh the negatives for patients and doctors. Owning your own practice can result in higher income, more independence, and greater control over your career and patient care. 

Independent Practice Ownership Benefits

Work-Life Balance

Owning your practice lets you determine the boundaries for your work and personal life — not a corporate entity. As the private practice owner, you have the freedom to determine your schedule. A strong work-life balance leads to higher job satisfaction and makes doctors less prone to burnout. 

Greater Control Over Career, Care

Working for a large healthcare system means working under the constraints imposed by those large organizations. This can mean less flexibility for personalized or tailored care or researching and implementing innovative practices. It also means you lose control over the direction of your career, a healthcare system is subject to changes caused by investors — new locations, electronic system changes, and other things that can impact your performance and career. 

Potential for Higher Revenue and Income

According to Medical Economics, private practices offer the highest salaries. The median salary of private doctors grew 8.4% in 2022 while the median salary of hospital doctors actually decreased in 2023. 

What is Medtail?

Before we explain how medtail is an exciting opportunity for doctors seeking a more independent and rewarding career — let’s explain what it is. 

Medtail, or medical retail, integrates healthcare services with retail settings. This approach provides the convenience and accessibility of retail spaces to enhance the patient experience while giving businesses more foot traffic and visibility. We all know how important convenience can be when it comes to supporting a business. Who hasn’t chosen a Starbucks drive-through over a sit-down coffee shop? According to NRC Health, a healthcare product and solution provider, 80% of patients reported they’d switch providers for “convenience factors” alone. 

In the same white paper, NRC Health found that patients seeking transparency and easier care experiences have fueled medtail growth leading to a 500% retail clinic growth since 2006 and 30% of patients relying on retail clinics for primary care. 

Medtail Benefits

More Convenient for Patients

As healthcare organizations have become more bloated, so have the sprawling medical campuses most patients must navigate. On the other hand, medtail settings are easier to navigate with dedicated parking, extended hours, and located in high-traffic areas. Shouldn’t taking care of your health be as convenient as grabbing dinner? 

Plus, it seems like all of us, patients and doctors, are a bit more pressed for time these days. Giving your patients the option to knock out two errands in one trip, as they stop at the hardware store after visiting the doctor only increases the chances that they’ll become a long-time patient. 

Higher Foot Traffic and Visibility

For many independent practitioners, word of mouth and referrals are critically important. Working alongside other complimentary retail spaces gives practices higher visibility and foot traffic, increasing the chance that a passerby will become a patient in the future. 

How to Take Advantage of Medtail: Real Estate Investment

To take advantage of the full potential of medtail, doctors will want to invest in real estate. Investing in real estate not only allows doctors to establish and fully control their medical retail location but also provides an opportunity for independent doctors to create another income stream and diversify their investment portfolio – creating stability and security for the long term. 

Commercial Real Estate Benefits for Doctors and Independent Practices

Asset Appreciation

Historically, real estate values have risen over the long term. Retail spaces have proven to be resilient and profitable investment for physicians and providers. 

Independent of Stock Market

We’ve all heard the timeless investment adage — don’t put all of your eggs in one basket. Real estate diversifies investments from the typical retirement portfolio strategy.

Opportunities to Lease 

As the owner of your medical office real estate, you’ll be able to lease any additional space to other businesses which can generate additional income as well as drive foot traffic and word of mouth to your business. 

How to Get Started in Medtail and Real Estate Investing

Whether you’re thinking of going from a corporate office to an independent practice or expanding your current practice, there are common steps each doctor should take to properly evaluate their business and find the right route to take advantage of a medtail location.

Analyze Your Market and Identify Opportunities

• Start with your goal for a new medtail location — are you expanding your current practice or hoping to become independent for the first time? 
• Analyze the market — are your potential markets saturated with other physicians in your line of care? Is there an opportunity to partner with another independent practice? 
• If you’ve determined a target area to build your practice or buy a commercial space, start thinking about your patients. What will they want to see in a new building? Think of factors such as accessibility, parking, and convenience. 

Find the Right Partner

Opening your own medtail practice is a major undertaking — it helps to have a partner that can help you navigate through the complexities of real estate development, financing, and regulatory challenges. 

To get started, here are some of the areas you should consider researching or looking for a partner to guide you through. 

Zoning and Regulatory Guidance  

Many private practice providers attempt to build and develop their building on their own. This can result in a long, drawn out project, but also cost a lot more than anticipated. A knowledgeable developer can streamline the approval process and ensure compliance with local laws and regulations. This not only saves you the hassle, but gives you the time to focus on what you do best — providing care to your patients. 

Construction and Development Expertise  

Experienced developers can manage construction efficiently, minimizing delays and ensuring your practice opens on schedule. Additionally, developers often have access to desirable properties, ensuring your practice is situated in a location that maximizes visibility and patient access.

Realizing Your Entrepreneurial Vision 

A great medtail real estate partner will help make your dream private practice come true. Partners who have experience in real estate investment can help you mitigate risk and obtain the resources needed to build your practice. Your medical real estate provider should be able to provide examples of successful case studies, build an action plan for every step of the project, and provide the tools and resources you’ll need. 

Partner With Ashton Gray for Full-Service Medtail Solutions

At Ashton Gray, we believe in making the dream of real estate ownership a reality. We provide doctors all over the country with the financial, regulatory, and real estate tools they need to establish a strong practice while allowing them to do what they do best — focus on providing patient care. Is medtail and independent practice ownership part of your vision for the future? Talk to the full-service real estate development experts at Ashton Gray about getting started.