At a growing number of hospitals across the country, it is now possible to have a cappuccino with your CAT scan. Mixed-use real estate is coming to healthcare, and more hospitals are integrating shops and appealing public spaces into their designs.

Northwestern Memorial Hospital in Chicago’s Streeterville neighborhood is one such place. Just over seven years ago, Northwestern Medicine set an ambitious goal to be a top 10 academic medical center by 2020. As part of the plan to achieve that goal, it committed to improving retail offerings and public spaces within Northwestern Memorial Hospital.

With nearly 10,000 employees, 67,000 neighborhood residents and 3,000 hotel rooms within a five-block radius, Northwestern Memorial was well-positioned for incorporating retail. Through a detailed retail market assessment and study, the hospital determined there was an unmet demand at the campus for about 50K SF of retail composed of mostly food and beverage shops.  

The shift toward experienced-based design and programming that has reshaped the retail landscape has started to impact healthcare real estate. Patients demand convenience, modern technology and speedy treatment when seeking care. Convenience can be boosted significantly in a mixed-use environment.

The line between healthcare and retail is blurring. More than 1,600 retail locations in the U.S. house healthcare clinics and an increasing number of pharmacies, supermarkets and retail chains have entered the healthcare space.

At Northwestern, the redesign called for bringing a neighborhood feel to the city-block-sized campus. Ground-floor retail with welcoming storefronts draw people in while a 9K SF restaurant concept met the demand for quality dining in the area. Additionally, the premium spaces on the active second floor of Feinberg-Galter Pavilions were transformed from internal administrative spaces to an eclectic mix of restaurants offering healthy foods.  

Retrofitting existing administrative and other spaces not originally designed for the demands of food service presented Northwestern with challenges on multiple fronts, and the hospital turned to the project team of KHL Retail, Stantec, Kiku Obata & Company and Skender Construction to help tackle these problems from the beginning.

Major infrastructure improvements were required to complete the project, including modifications to the base building structure, installation of new electrical service for future tenants, black iron ductwork and extensive plumbing alterations.

“As anyone who has worked in healthcare knows, finding a space for anything in an existing hospital is a challenge, let alone major structural and MEPFP [Mechanical, Electrical, Plumbing and Fire Protection] elements,” Skender Construction Project Executive Brian Simons said. “Extensive investigation and pre-planning before the design was completed allowed for the team to determine the most feasible and cost-effective means of designing and installing the infrastructure improvements. This allowed for minimal design and construction rework once construction was underway.”

Introducing a project of this magnitude into an active hospital required communicating and interacting with the Illinois Department of Public Health. The preparation work that had to take place before the infrastructure improvements, the multiple phases of infrastructure construction, public area renovations and the multiple iterations of tenant build-outs all had to be communicated and coordinated with IDPH to ensure its requirements were satisfied.

Understanding the intricacies of not only healthcare design and construction but also in the infrastructure, civil, retail and office/administrative aspects proved to be critical in the successful execution of the project, Simons said.

While not every healthcare real estate project will require the rigor or scale that Northwestern's renovation needed, mixed-use healthcare development is taking hold.

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