One irrefutable positive to come out of the last two years is that personal health and wellness has now become a priority and not an afterthought. Whilst elements of improving our health have been adopted as passing trends in recent times, studies are clear that since the pandemic took hold, many of us are making a more conscious effort to incorporate health into our everyday decision-making and we’re valuing our health more than ever before. Research from GSK Consumer Healthcare in Europe revealed a shift in attitudes towards self-care in that 65% of those questioned said they were now more likely to consider their health in making day-to-day decisions.
Health and Wellness Meets Real Estate
When the elusive return-to-work does happen albeit more flexible than before, employees are no longer questioning the safety of doing so, but they are being openly discerning about whether they even want to. Most companies have been able to follow simple screening and sanitizing protocols but the fundamental question is how do they compete with a newfound work-life balance which is essentially better for both physical and mental health than commuting to work and sitting at a desk for at least eight hours a day?
Aside from compensation, employers need to be investing in either in-house health and wellness facilities or locating themselves in buildings and communities that have the amenities to enhance someone's working day and quality of life; plus it all needs to be done with people and personalization at the heart.
Putting People First
Wellness can mean different things to different people. A McKinsey survey on the future of the wellness market, identified the top six ways that consumers view wellness. Health, fitness, nutrition, appearance, sleep and mindfulness were the areas that interested people the most, but the breakdown of what these consumers would spend money on was very much different depending on demographics, lifestyle, approach to social responsibility and income.
The challenge for employers is to let employees drive the health and wellness strategy of the company and to listen and support them in what’s going on in their personal lives. It’s going to be a big culture change for many organizations but life has been turned upside-down in the last couple of years, in many ways to the advantage of workers and there’s no going back now. It’s unfortunate that it’s taken a pandemic to come to this realization but work and life are interconnected, not a 50-50 split and employers that take a human approach to designing work around the demands of life instead of the other way around are the employers that will prosper.
The challenge for commercial real estate owners now more than ever is understanding their market and tenants’ needs and utilizing smart data to make decisions that attract forward-thinking companies to their spaces.
Health is Wealth in Commercial Real Estate
The wellness real estate market grew at a global rate of 54% from $148 billion to $275 billion in just three years between 2017 and 2020. As other countries doubled their growth, Canada was the second-top growth leader out of the top 20 international markets for wellness real estate with a staggering 240% growth.
Wellness real estate is defined as the construction of commercial/institutional and residential properties that incorporate intentional wellness elements into their design, materials, building and amenities, services and programming. This is not a new concept for commercial buildings; the WELL building standard was introduced in 2014 to address the holistic needs of people’s health and wellness through the built environment and has so far been used in over 35,000 projects worldwide.
In Ontario, the highest certification has been awarded to a handful of mostly large corporations as small-to-mid sized organizations don’t have the same scale with which to build such amenity-rich facilities. This presents a huge opportunity for investors in this experiential market to better collaborate with tenants on customized health and wellness spaces that also function as hybrid work environments.
Furthermore, it opens the doors to new types of retailers and service providers to occupy space in office buildings that never would have been considered viable before. No longer segregated to ‘medical’ office plazas, these smaller health businesses are driving footfall and helping to secure tenants for offices above - they’ve already proved they’re pandemic resilient and now’s their time to shine as a destination in their own right.
Amenities that Appeal
Consumers are looking to increase spending on both wellness products and services with an emphasis on the use of more services including nutritionists, personal trainers and counseling and therapy. Work communities’ that encompass value-added health and wellness benefits providing their employees with increased access to and options for alternative care, over and above corporate health plans will be best placed to thrive.
Wellness real estate will progress quickly, incorporating access to telemedicine and alternative holistic practitioners, offering digital solutions that combine with occupant apps and devices to offer a personalized approach to managing health in the workplace, retail experiences for new wellness products and services, time and space for meditation and ‘natural’ food choices. These are just some of the health and wellness initiatives to supplement more practical choices on lighting and ventilation for example, but there is really no limit to what may be achieved.
Conclusion - Health and Wellness is a Value Driver in Real Estate
Now that the pandemic has put building at the forefront of mind with regards to human health, the wellness real estate market is outperforming predictions and Canada is leading global growth.
The ‘new normal' puts tenants and their employees on the front-foot; they can afford to be particular about the space they’re spending the lion's share of their time in each week and building owners who proactively improve their health and wellness standards will be compensated by higher occupancy and increased returns - those who choose complacency will miss riding the wave of exponential growth.
Reach out today to find out more on the GTA wellness real estate market and how you can inject health and wealth into your next project.