High Obesity Rates Demand Redevelopment

Written by Daniel Wyatt, associate at Lee & Associates – Houston

Houston was once considered to be the fattest city in America. While it thankfully no longer holds that title, the city still has an obesity problem. According to County Health Rankings and Roadmaps, 27% of adults in Harris County are considered overweight or obese. That percentage is steadily growing at a rate of 1.8% along with other health issues as a result.

More than 700 bariatric surgery facilities have been developed throughout the country, with more still needed in Houston.

With facilities focused exclusively on obesity and weight loss programs, medical companies need a space designed to improve the quality of care for patients as well as medical practitioners. Larger exam tables, scales, stretchers, operating tables, bariatric wheelchairs, and oversized furniture are just some of the equipment ownership that need to be accounted for when considering what type of space will work for their company.

What does obesity have to do with Houston’s commercial real estate market?

Existing health care facilities are out of date and need to make changes to allow for proper care. The associated costs to upgrade existing facilities with specialized equipment and accommodating furniture are substantial. To give perspective, the average cost of a bariatric wheelchair is $3,000. As a result, there’s a significant need and real opportunity for real estate companies and developers to create a space suitable for weight loss facilities. These surgery centers accounted for $6 billion in revenue across the country in 2018, so it’s no wonder Houston’s commercial real estate space is growing in the medical industry.

Today’s medical spaces require structural changes to door frames, hallways, and other room reconfigurations to allow for safe patient treatment and larger medical equipment. Commercial real estate investors can take advantage of this opportunity by either redeveloping older properties and serving an immediate need or developing a facility from the ground up. In 2019, bariatric procedures in North America are predicted to surpass a quarter-million cases, over 60% of these being gastric sleeve procedures based on estimates from the American Society for Metabolic and Bariatric Surgery. Investing in large upfront infrastructure costs shows returns of approximately $11,000 after procedural costs and contractual deductions, for developing a single bariatric surgery care center.

Investing in Tomorrow’s Medical Spaces

Care facilities must be thoughtfully redeveloped with accessibility in mind to best serve the patients and medical teams. Real estate developers are pulling together with local health care communities to support the advancement of these obesity solutions. We expect developers to continue investing in new build environments that will contribute to decreasing the obesity rate in Houston in the years to come.

Our own Texas Children’s Hospital, one of the country’s premier children’s hospitals, is already providing solutions to Houston’s obesity epidemic and is an advocate for community-based health clinics that provide the accessibility and care to meet the needs of the Houston community. Obesity has become a concern at the forefront of our medical industry. Cutting edge facilities outfitted with a new wave of technology steers efforts to reduce the one-in-three rate of obesity in Texas.

Lee & Associates is proud to be part of this positive movement with a new medical business line that aims to help redevelop existing facilities and find locations for new ones. The overall impact will be seen in the future as medical and CRE communities push forward together.

About Lee & Associates – Houston 
Lee & Associates – Houston is a fully-integrated commercial real estate company with unrivaled capabilities and an unwavering dedication to integrity. Our business-minded brokers specialize in office, industrial and land real estate investments. As the fastest-growing broker-owned firm in the nation, with more than 60 office locations in North America, we are uniquely qualified to support our clients’ real estate needs in the local, national and international markets. For more information, visit www.lee-associates.com/houston/.