Mall to Medicine Repurposing

21st June 2023
One of the key trends emerging in retail asset management is shopping centre repurposing, whereby former units are turned into alternative uses such as pop-ups, leisure, workspace or even art galleries.

However, Sovereign Centros has been helping to pioneer another form of repurposing at the UK’s second largest shopping centre, Metrocentre in Gateshead. So-called ‘mall to medicine’ is a creative approach to adapt existing infrastructure to meet the evolving needs of the community, providing convenient and accessible healthcare services while breathing new life into former retail spaces.

At Metrocentre, 39,000 sq ft of the former House of Fraser department store is being converted into a Community Diagnostic Centre (CDC) which is forecast to service up to 145,000 appointments per year.

Senior Asset Manager Ben Cox explains: “This is an initiative of true significance and part of a £90bn NHS plan to free up priority medical care across the UK. This CDC is one of a substantial programme of new centres across the country which are designed to be one-stop-shops with a variety of medical support services offered.

“These new types of facilities have been on the agenda with the NHS for some time now and with the Pandemic leading to a backlog of appointments, the impetus to develop evolved and consolidated facilities has gathered pace.

“This new centre is expected to create up to 134 jobs and has been developed in partnership with Gateshead Health NHS Foundation Trust and the Newcastle Upon Tyne Hospitals NHS Foundation Trust. It will be situated on the ground floor, just behind Harrods Beauty.”

Talking about how the new offering will add value to this nationally-renowned retail asset, Ben says: “Metrocentre is designed to be a host for brands and we see NHS as being a world-leading brand. As well as being a valuable resource for the local community, this new CDC will act as a new anchor tenant within the shopping centre and offer a stable income stream for many years to come.”

The idea behind adding some form of medical facilities into shopping centres is not entirely new as we’ve had walk-in GP clinics for some years. However, the need for this medical repurposing of former retail units – in many cases failed department stores – is a response to the rise of online shopping and changing retail landscapes. At the same time, there is often a growing demand for accessible healthcare services, particularly in areas with limited medical facilities or in regions experiencing population growth.

By repurposing a retail asset into a medical facility, developers and healthcare providers can take advantage of the existing infrastructure, such as spacious floor plates, ample parking spaces and convenient locations. Additionally, re-using existing structures can be more cost-effective and time-efficient compared to constructing new medical facilities from scratch.

As Ben points out: “Metrocentre already has excellent facilities including a strong range of retails brands and leisure pursuits, plenty of free parking, EV charging and comprehensive public transport connections. So, it makes sense for the local NHS providers to use it as the location for a state-of-the-art medical centre.”

Talking about the potential role that healthcare could play in other shopping centres, Ben explains: “There is a huge field of opportunity with this new type of occupier. Starting with projects like the CDCs, there is no reason why you couldn’t also add a whole host of ancillary services including eye surgery, renal clinics and dental practices.

“Together with increasing numbers of in-centre workspaces and greater use of leisure within shopping centres, these repurposed former retail spaces can achieve greater levels of footfall – particularly during the week – and can act as a new focal point within the asset, drawing in other new occupiers and a more diverse range of visitors.”

Ben concludes by saying: “Sovereign Centros has a long track record of maximising the return from retail assets, and this includes repurposing. At our shopping centres around the country, we are constantly looking at providing an experiential offering which ensures the long-term viability of our centres. Initiatives with Medical Services are just one of the exciting new repurposing ventures that the Firm is working on and we are very much looking forward to the opening the CDC in early 2024.”