From checkouts to checkups: Why old retail spaces are a new trend in health-care delivery

A former Costco warehouse in Newfoundland is being given a new life as an ambulatory and urgently needed health care facility. Garrett Barry has the story.

Even on one of the snowiest days of the winter, boom lifts and ladders are buzzing about near a construction site on the northeast end of St. John’s, N.L.

The building, once well-known to shoppers from across Newfoundland and Labrador, is getting a second life as a provincial government medical centre — a big box retail store turned health hub in the city.

By the end of the year, managers hope to have renovations on this 80,000-square-foot facility finished and ready for patients to walk through the door.

The site, a former Costco warehouse, will be split between an urgent care clinic and an ambulatory care centre. Newfoundland and Labrador Health Services plans to relocate some staff and equipment from the Health Sciences Centre in the centre of St. John’s to the renovated building.

Services like X-rays, ultrasounds, physiotherapy, and blood collection will soon be placed in the new site.

It’s a bid to reduce traffic at existing hospitals and reduce wait times for patients who are constantly bumped down on triage lists. True “emergency room” problems, the most urgent, will still only be seen at the emergency room at existing hospitals, but other pressing cases for patients can be seen in the new facility.

“They will have a better experience and they’ll be seen faster, presumably,” said Greg Browne, a medical director at Newfoundland and Labrador Health Services.

“It will decant some of the pressure from emergency departments, which are under tremendous pressure right now.”

The health board is renting the building, not buying it, and has signed a 20-year lease with the Newfoundland and Labrador Health Alliance worth about $80 million.

How it’s being built

To prepare the space, contractors had to install a second floor, which will be home to most of the new clinic areas.

Daniel Parsons, a planner for the health board, said working with an existing building gave contractors a head start on the construction work, given that there’s cladding, exterior walls and a substantial parking lot already on site.

“That reduces the amount of time it takes to get the services up and running. And it also has an impact on our construction risk,” he said.

“Our existing facilities are very tight and there is a very much a strong need to expand as quick as possible.”

It’s an ambitious renovation of an old retail space into a new health-care centre. It’s not the only one of its kind, but it may be one of the biggest, according to Kate Camenzuli, a real-estate consultant with CBRE.

“We’ve seen success in smaller spaces, and we’ve seen success of amalgamating under one roof. It’s now waiting to see how governments do one large platform at a time,” she said.

“I just hope that they find the partners to help them execute on that properly, because I do think this is a huge opportunity.”

Camenzuli says the so-called “medtail” model offers promise and reason for health care operators, both public and private, to be interested.

Former retail sites already have infrastructure nearby, whether it be bus stops or grocery stores, that draw patients and clients into the area.

So far, private operators have been leading the charge, but the size of investments from provincial governments and health boards are poised to bring the trend to the next level.

“As much as this is innovative across the country, it’s really an easy marriage,” she said. “I think that we’re going to see more of this.”

In St. John’s, Parsons said the former Costco warehouse had a few distinct advantages. Its layout was wide open, so crews didn’t have to spend much time tearing away drywall and reconfiguring plumbing.

It’s also a known location where people shopped for years.

“There is something to say about, you know, having a facility such as this that was so well known to the community,” Parsons said. “That uncertainty of going to a new facility that’s a little bit lessened when you’re not concerned about having to figure out how to get there.”