I’ve spent over two decades studying wellness providers who build real wealth—not just income. There’s a clear pattern: the ones who break through stop thinking like tenants.
Here’s what I mean. A VMG Health case study profiled a med spa operating out of a 2,500 square foot standalone retail location. After three years of consistent growth, surpassing projections and budget expectations every year, the owner was ready to expand.
But instead of just finding another space to lease, this owner did something different. They started thinking strategically about real estate as an asset class, not just a cost of doing business.
This is the shift I want to talk about today.
The Math Most Wellness Providers Never See
Consider the typical wellness provider's trajectory. They sign a lease at $5,000 a month. Over a 10-year period, that’s $600,000 in rent—often more with annual escalations.
At the end of those 10 years, what do they have to show for it? A stack of canceled checks and a landlord asking for more.
Now, consider the alternative. That same provider buys a building using an SBA 504 loan with 10% down. Their monthly payment might be similar, but every payment builds equity. After 10 years, they own a significant portion of an appreciating asset.
The wellness real estate market has doubled from $225 billion in 2019 to $548 billion in 2024, growing nearly 20% annually. That’s faster than any other real estate category. Most of that wealth? It’s being captured by landlords, not the wellness providers driving the demand. Why let that opportunity slip by?
If you’re serious about building wealth through real estate—and not just running the same playbook as every other provider—you need sharp, actionable insight on the market. Not hype, not headlines. Real signal.
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The Wellness Hub Model
The smartest wellness real estate investors don’t just buy buildings for themselves—they create what I call “wellness hubs.”
The concept is simple: buy more space than you need, then lease the excess to complementary wellness tenants.
A physical therapist buys a 5,000 SF building but only needs 2,500 SF. They lease the rest to a massage therapist, a nutritionist, and a mental health counselor. The rental income covers most (or all) of the mortgage. Meanwhile, the co-tenancy creates natural referral relationships.
Research from Boston University shows that wellness communities with complementary services outperform standalone locations significantly. When you cluster PT, nutrition, mental health, and aesthetic services together, you create a destination. Patients visit more frequently and refer more often.
I’ve seen this model work across wellness categories: med spas co-located with IV therapy and fitness studios. Chiropractic practices sharing space with acupuncturists and functional medicine providers. The combinations that work best share a patient demographic but don’t compete directly.
Why This Works for Wellness Specifically
Three structural advantages make wellness providers particularly well-suited for the owner-operator model:
SBA 504 loans are designed for this. The program offers 10% down, 25-year fixed rates, and up to $5.5 million for owner-occupied properties. Medical practices, wellness centers, and healthcare facilities are explicitly eligible. If your practice is profitable and you’ve been in business for 2+ years, you’re likely a candidate.
Wellness tenants pay premium rents. Healthcare REITs report 92%+ occupancy rates for wellness-anchored properties, compared to 85-88% for traditional retail. Industry data shows the med spa industry alone was a $22 billion business by the end of 2024. When you become the landlord, you capture those premiums instead of paying them.
The co-tenancy effect compounds value. Wellness services are inherently referral-driven. When you control the tenant mix, you control the referral ecosystem—and you benefit on both the clinical and real estate sides.
The PE Angle
Here’s something else worth considering. Private equity is consolidating wellness fast—over $3 billion has flowed into med spa M&A alone in recent years, with 80% of med spas still operating as single locations.
When PE firms evaluate acquisition targets, clean real estate significantly increases valuations. Owning your building (or multiple buildings) puts you in a completely different negotiating position than someone with lease obligations.
As Medical Economics reports, physician groups that properly structure their real estate before a transaction can capture more value—often 15-20% more than those who don’t. The same applies to wellness providers positioning for eventual exit.
Is This Right for Every Wellness Provider?
No. The owner-operator model requires:
Stable cash flow. Your business should generate enough to service debt comfortably. Lenders will verify this.
Long-term commitment. If you’re testing a new market or planning to relocate in 3-5 years, leasing still makes sense.
Operational bandwidth. Being a landlord adds complexity—tenant relationships, maintenance, property management.
But if you’re an established wellness provider who’s been paying rent for years, building someone else’s wealth while your lease costs keep climbing? It might be time to think differently.
My Take
After 26 years in healthcare, here’s what I believe: the wellness providers who build generational wealth aren’t just great clinicians. They’re strategic about real estate.
They understand that every rent check is a choice—a choice to build their landlord’s equity instead of their own. And at some point, usually after years of watching those payments add up, the math becomes impossible to ignore.
The wellness hub model isn’t complicated. It’s just a different way of thinking about the space your business occupies. Instead of viewing real estate as a cost to minimize, you start viewing it as an asset to optimize.
That shift in perspective is worth millions over a career.
Let's talk about your 2026 strategy
I'm offering complimentary Fractional CRE Officer discovery calls for health and wellness businesses that are expanding, acquiring property, or preparing for exit.
Whether you're opening your first location, negotiating a major lease, or planning long-term strategy, I'll help you:
✅ Identify the biggest risks and opportunities in your current portfolio
✅ Understand whether your next move should be lease or buy
✅ Structure deals that protect your cash flow and support growth
✅ Prepare your real estate for an eventual exit or sale
After 26 years in healthcare and commercial real estate, I know the operational pressures you face, the financial metrics that matter, and the decisions that separate businesses that scale from those that stall.
The Next Gen Dev - Wellness Edition is your weekly briefing on the strategies and frameworks that separate wellness businesses building the future from those stuck in the past.
Know a wellness provider who’s looking for space or stuck in a bad lease? Forward this email.
