A Seismic Shift In Healthcare

The Real Estate Espresso Podcast

A Seismic Shift In Healthcare

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A Seismic Shift In Healthcare

Welcome to the Real Estate Espresso Podcast, your morning shot at what’s new in the world of real estate investing. I’m your host, Victor Menasce.

There is a seismic shift not in real estate per se, but in a sector that will fundamentally reshape how we think about healthcare services and how they’re delivered. This, in turn, will have an impact on the need for real estate in a healthcare setting.

Family medicine has evolved. When I was a child, the family doctor was a self-employed professional with one name on the office door, and a receptionist who often doubled as the doctor’s assistant. That model is completely obsolete. Now, family health team clinics, which have several owners, numerous associates, nurses, a nurse practitioner, and even other services like a dietitian and a blood lab, are the norm. They are often affiliated with large healthcare providers.

For years, the healthcare model has been stuck in the 20th century—you feel sick, book an appointment, drive to the clinic, sit in a germ-filled waiting room, and then get a few minutes with the doctor. It’s inefficient and a poor experience. But just like technology has disrupted retail and media, it’s now coming for healthcare. The first wave was simple telehealth. These are phone calls with your doctor, or video calls. The use of telehealth multiplied out of necessity during the pandemic. It was a good start for quick follow ups or prescription refills, but it was limited.

Senior citizens make up 18% of the U.S. population and about 20% of the population in Canada. They account for a disproportionate share of doctor visits, which often require adult children to take time off work or incur high transportation and parking costs. There’s also time lost in the waiting room and traffic. A doctor is limited to what they can diagnose over a video call. The key to true disruption isn’t just connecting people virtually, it’s bringing the tools of the doctor’s office into the patient’s home. New products that transform telemedicine are now emerging. These diagnostic devices, from companies like Remi Health, Eco Devices, and TitleCare aren’t just webcams—they’re handheld examination devices.

One device from TitleCare, an Israeli company, is a stethoscope, an od周温, and a thermometer all in one, connected to an app. It can capture high quality images of a sore throat, record your heartbeat, check a rash, and transmit all of the data directly to your physician for a remote diagnosis. Over a video conference, a doctor can diagnose about 250 possible conditions. But with this additional technology, the number of diagnosable conditions increases to over a thousand. This changes everything.

A parent no longer has to take a sick child to urgent care late at night, exposing them to more illness and losing sleep. People with chronic conditions can monitor themselves daily and send the data to their doctors, preventing minor issues from becoming emergency room visits. The implications are huge. For patients, it’s about convenience and control, saving time and money on travel. For healthcare providers, it’s about efficiency and cost reduction. Fewer in-person visits allow clinics to focus on more complex, serious cases, reducing the strain on urgent care centers and emergency rooms. These innovations shift the entire model from reactive to proactive care.

This isn’t just a fad. It’s a fundamental shift to how a multi-trillion dollar industry operates. Consequently, the need for large office buildings and traditional brick-and-mortar healthcare footprints will likely shrink. The new clinic is, in fact, your home.

Last week, I met with the CEO of a national healthcare system who claimed that between 60 to 80 percent of in-person appointments could be diagnosed using this technology, reducing the burden on the clinic. While there are many valid reasons to see a doctor in person, if the number of visits can be reduced, then family medicine clinics could provide a full range of services within a smaller real estate footprint.

This change is coming and is as clear as day. Commercial real estate has taken a beating since the pandemic, and medical offices have been one of the few stable segments in the office market. I can’t predict how quickly this technology will penetrate the market. However, within the next five years, I believe today’s existing technology, even without serious improvements, will achieve sufficient market penetration that we’ll see a significant reduction in medical office footprints. So while everyone’s talking about the next big real estate play, keep your eyes on the technology that’s quietly making an entire real estate sector partly obsolete.

As you think about that, have an awesome rest of your day. Go make some great things happen. We’ll talk to you tomorrow.

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