Retail Merchandiser - May/June 2017 - 62
SOLUTION PROVIDER RETAIL MANAGEMENT
How retail landlords can successfully make retail-medical leases work.
BY ANDREW MAGUIRE, ESQ.
lated tenants in the future. For example, the landlord might insist on adding
language to the lease which permits it
to lease space to a pharmacy with an
in-store clinic. Both parties to the lease
should review the use exclusives which
have been granted to the shopping center's existing tenants to verify that the
medical tenant's use will not conflict
with these existing tenants.
Before leasing any retail space, the
healthcare tenant should carefully check
the applicable zoning code. If the zoning designation for the shopping center
does not allow for the tenant's medical
use, the tenant and landlord should
coordinate efforts to obtain zoning relief
from the municipality.
In order for the retail-medical lease to
work effectively, certain retail leasing
standards must be relaxed.
Recently, there has been a nationwide
surge of hospital systems and other
medical providers opening locations
in suburban malls and shopping centers. Suburban medical offices offer convenient health care for patients, and retail
landlords are excited by this new demand
for their space. However, the medical use
tenant and retail landlord must navigate
three main obstacles to make retail-medical leases work properly.
Any medical provider will want their
lease to allow it to perform its full
range of services within their leased
space. During lease negotiations, medical tenants often push for the exclusive
right to conduct their practice specialty within the shopping center. The
landlord will typically limit these 'use
exclusives' to preserve the landlord's
options for leasing to other medical-re-
Retail landlords may be unfamiliar
with the patient privacy restrictions
placed on healthcare providers under
the Health Insurance Portability and
Accounting Act of 1996 ('HIPAA').
To avoid HIPAA's stiff civil and criminal enforcement, the medical tenant
is right to limit landlord access within
those areas where patient records are
kept. Typically, the landlord will agree
to stay out of any patient file areas unless accompanied by a tenant representative or in the event of an emergency.
These access restrictions must be
explained to contractors who enter the
space to perform work during the term
of the lease.
Retail Standards vs.
In order for the lease between the
shopping center landlord and the