Retail pharmacies are vanishing from suburban and rural America, and healthcare providers are moving in to take their place. As legacy retail chains such as CVS and Rite Aid scale back, it’s important to note that these are not just retail store closures. They signal a growing opportunity to reshape healthcare real estate in communities that need it most.

The U.S. pharmacy retail landscape is shifting dramatically. Earlier this year, CVS Health announced it would close 271 pharmacy locations as part of an ongoing restructuring strategy that began in 2022. The initiative aims to optimize store footprints based on population shifts and healthcare delivery trends. Meanwhile, Rite Aid filed for its second Chapter 11 bankruptcy in under two years and plans to shutter hundreds of additional stores.

These pharmacy exits are especially disruptive in suburban and rural communities, where retail pharmacies often serve as critical access points for basic healthcare services. Their exit leaves a gap, but also creates space for innovative healthcare real estate solutions.

The Rise of Medtail

Medtail, the integration of healthcare services into retail spaces, is emerging as a key strategy for both healthcare providers and landlords. Vacant retail sites, especially former pharmacies and big-box stores, offer strong visibility, ample parking, and consumer familiarity, making them ideal for outpatient care. A standout example is Vanderbilt University Medical Center, which repurposed 450,000 square feet of the One Hundred Oaks Mall in Nashville into a comprehensive outpatient facility offering services including women’s health, dermatology, and imaging.

In another major redevelopment, Inova Health System is transforming Alexandria, Virginia’s former Landmark Mall into a $2 billion hospital campus. The site will combine acute care, outpatient services, and retail within a walkable, mixed-use environment.

While medtail is gaining traction in urban areas, it’s potential to transform healthcare access in suburban and rural communities may be even greater. These locations can help fill care gaps left by retreating retailers and bring services closer to where people live.

Opportunities in Suburban and Rural Communities

Suburban and rural markets are especially well-positioned to benefit from medtail conversions. As hospitals in these areas close or consolidate, retail vacancies offer healthcare providers a cost-effective and timely route to reestablish access. Rather than building new facilities from the ground up, providers can renovate and retrofit existing structures that are already part of the community’s daily life.

For developers and landlords, these underutilized retail assets present an opportunity to partner with healthcare providers and reshape access in underserved areas. This is about more than convenience. In areas where pharmacy closures have created healthcare deserts, medtail sites can house urgent care, primary care, mental health services, and diagnostics. These services can be delivered in locations residents are already familiar with.

A More Patient-Centered Experience

Beyond location, medtail also supports a more consumer-friendly healthcare experience. Former retail spaces are being redesigned to accommodate higher volumes and efficient patient flow, while maintaining a familiar, non-clinical atmosphere. Well-designed medtail spaces support ease of navigation, flexible check-in options, and clear wayfinding. These features enhance patient comfort and satisfaction. These locations also align with the one-stop-shop model that today’s consumers increasingly expect, integrating lab work, imaging, pharmacy pickup, and clinical visits in one setting.

Challenges to Address

Of course, medtail is not without challenges. Conversions require substantial investment to meet clinical standards for infrastructure, HVAC, compliance, and accessibility. In rural areas, staffing remains a hurdle, with fewer providers available to support these new sites.

Zoning and regulatory approvals can also slow progress. Not every community is quick to approve medical uses in retail corridors, making local partnerships an essential part of a successful development.

Strategic Outlook

For real estate investors, healthcare systems, and local governments, this is a pivotal moment. The contraction of retail and expansion of outpatient care are converging, creating a rare opportunity to reimagine how real estate can support public health. By embracing medtail, stakeholders can bridge gaps in care while revitalizing underused commercial properties. The result is improved healthcare access and more vibrant, resilient communities.

Now is the time for healthcare providers, real estate leaders, and community planners to come together and invest in solutions that bring care closer to home. With the right strategy, medtail can turn empty storefronts into hubs of health, convenience, and community resilience.