Terravet Real Estate Solutions founder and CEO Daniel Eisenstadt is an expert in veterinary real estate and co-founder of Community Veterinary Partners, a regional corporate operator of veterinary practices. He has garnered a great deal of insight from the challenges of 2020 and 2021 as they relate to the future of veterinary real estate.Read Articles Written by Daniel Eisenstadt
According to the American Society for the Prevention of Cruelty to Animals, 1 in 5 households acquired a cat or dog since 2020, and total spending on veterinary care reached record highs of over $32.4 billion in 2021. The increased demand for high-quality medical care puts added pressure on practice owners, veterinarians and team members to keep patients and their owners happy.
With pet owner preferences changing and medicine advancing, veterinary real estate owners must re-evaluate their practices to ensure they provide purposefully designed spaces for employees and patients. Most of all, in light of the shortage of veterinarians, practice owners must deliver workplaces that support doctor recruitment and retention. Small, converted homes are no longer preferred by pet owners or veterinary professionals.
Looking to the future of veterinary hospitals, I expect more relocations and a greater emphasis on operational efficiencies and talent-retaining initiatives.
Vacant Retail Spaces
Historically, practice owners hesitate to relocate their well-established clinics and chance losing long-time patients, but that dynamic is changing. Veterinary real estate was an outlier in the commercial real estate industry until a few years ago. However, the veterinary sector was one of the few that remained resilient and continued to be profitable despite the pandemic. The ongoing shift to a work-from-home model and retail sales going increasingly online have put more pressure on commercial and office landlords and led to vacancies in certain areas.
As the trends continue, landlords will view veterinary tenants even more positively. Many retail vacancies likely will be located in centrally located spaces with high traffic and ample parking. Moreover, developers continue to build new retail spaces, which are attractive locations for veterinary practices.
The lesson for veterinary real estate owners is clear: It’s critical to invest in modernizing and expanding existing facilities to provide great workspaces for veterinarians and to compete with newer buildings and growing numbers of available retail spaces.
Promoting Operational Efficiency
Convenience is key, especially since the pandemic. Employees and clients expect everything to be at their fingertips. Luckily for practice owners, adjusting their real estate and the design of their spaces can accommodate the desire for convenience.
To perform at their best, veterinarians need a functional, smartly designed space. And as more pets find their forever homes, veterinarians are working overtime to complete checkups, administer shots and perform emergency care. Being on top of one another or not being able to see an animal because all the exam rooms are occupied is disheartening and detrimental to the quality of care provided. Creating a space with the flexibility to add exam rooms or treatment areas not only pleases the pet owner but also allows the veterinarian to stay organized and perform the job more efficiently.
Creating Places to Thrive
Due to the labor shortage, most savvy practice operators are focused on recruiting and retaining veterinarians. According to Mars Veterinary Health, the United States could have a shortfall of 15,000 veterinarians by 2030.
Although veterinary real estate owners cannot produce additional DVMs, they can design a facility that caters to the needs of veterinarians and acts as a magnet for attracting and retaining talent. Like any employee, veterinarians are looking for upgrades in their environment and workplace culture. Since they spend so much time at the practice, they prefer an office that is comfortable and pleasing to the eye and has space to record patient notes after visits and relax during downtime. It’s also essential for the facility to accommodate up-to-date diagnostic tools.
In a job that is already stressful, providing veterinarians and technicians with greater, cleaner, more sophisticated facilities increases employee satisfaction. The veterinary industry is evolving, and with it comes the changes necessary to promote business growth.