3 Ways Healthcare Systems Can Leverage Real Estate For Savings, Growth
Hospitals and healthcare systems can realize untapped savings by better managing their real estate footprint and strategy, according to a July 19 report from real estate firm JLL.
The report analyzed ways in which providers can improve cost management, care coordination and patient access through real estate strategies that promote systematization.
“Real estate can be a way to achieve greater benefits from systematization, and the performance of real estate assets can be improved by a more systematic operational approach,” JLL said. “It’s a mutually beneficial relationship that improves value for both owners and occupants over the long term.”
Here are three strategies for leveraging real estate to grow and save money, according to JLL:
1. Establish a solid localization strategy. Places of care influence brand perception, patient access and the experience of care, which makes these decisions important, JLL said. To determine the best opportunities for growth, healthcare systems should use location analysis and demographic trends, according to JLL.
2. Create integrated facilities management programs. Having facility management programs in place can generate savings and prevent deferred building maintenance, JLL said. Having an integrated plan can pool risk while aligning resources, mitigating duplication, and reducing solos. One of the best ways to ensure an integrated program is to collect data on the facilities themselves, including usage rates, energy consumption, and maintenance schedules.
3. Increase the value of real estate through systematization. Typically, more integrated health systems have better credit scores than less integrated systems or individual hospitals, JLL noted. Credit strength can be used to negotiate more favorable rental terms or generate higher returns in the event of a sale or leaseback transaction. As a result, the integration of real estate locations is beneficial for real estate value. “Systematization can create value for real estate assets that healthcare systems can monetize, allowing systems to redeploy capital to expand or modernize healthcare delivery or use to fund other priorities,” JLL said .
Access the full report here.