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PALM COAST, FL – September 7, 2020 – UNF MedNex is an innovative public/private partnership that will bring healthcare education and training to Palm Coast’s Town Center. It has become a political issue. It should not be. Here is why.
The people whose job it is to find and recommend sites for new, relocating, or expanding businesses are called site selectors. They research each potential site for suitability based on the needs of the client whether they be a manufacturer, service provider, retail outlet, or chain restaurant.
Site selectors “drop a pin” on a map of a potential city or town, then draw a series of concentric circles around that pin, say one-mile, three-mile, five-mile, or more. Using tools available to them, they can determine the population and demographic detail (age, sex, education level, income, etc.) encompassed within each circle.
Each business has its own proprietary profile, looking for a concentration of employees and/or customers. A fast-food restaurant might look only one or two miles out. The Costco model likely has a further reach, but for all, population and demographics are key. (And that is why we do not have a Costco in Palm Coast.)
In the United States, 22.3% of the population is under age 18. In Florida, that percentage is expectedly lower – 19.7%. In Flagler County, only 16.6% of our residents are younger than 18 (based on the latest U.S. Census Bureau population estimates as of July 1, 2019). Unlike the Halifax Health and AdventHealth facilities in Daytona Beach, AdventHealth in Flagler County (our only hospital) does not have a neonatal intensive care unit. “Nothing to see here. Move along please.”
Differences at the other end of the age spectrum are more dramatic. Persons aged 65 and older represent fully 31.2% of Flagler County’s residents. This compares to 20.9% for Florida and only 16.5% for the U.S. Is that important? Absolutely, especially if you are a site selector in the healthcare industry.
Based on Flagler’s estimated 115,081 residents, there are 35,908 individuals in the age 65+ category (seniors). If Flagler’s senior percentage were at the national average (16.5%), there would be only 18,988 seniors living here. If a healthcare industry site selector is looking for a market that has at least 35,908 seniors, they can pick Flagler County, with its 115,081 residents, or they can pick an average Florida county with at least 182,259 residents, or pick an average U.S. county with at least 217,608 residents.
The following diagram illustrates the population needed to reach a targeted aged 65+ demographic under Flagler County vs the overall U.S. age distributions.
Clearly, Flagler County is a target-rich environment for senior health care. The numbers do not lie, but why is the senior healthcare segment so sought after? Because that is where the money is. According to the Agency for Healthcare Research and Quality, the average annual expense for healthcare for those under the age of 18 (in 2017) was $2,800. For those between 18 and 64, the average annual expense was $5,784. For those aged 65 or above, the average annual expense rose to $11,947. The median expenses by age category were $678, 1,512, and $5,127, respectively. By either measure, seniors lead the pack.
ANNUAL HEALTHCARE COSTS BY AGE GROUP
Using the average healthcare expense, the annual healthcare revenue in Flagler County is about $829.9M. If the county had the same demographic profile as the state, the Flagler healthcare revenue would be $746.2M, and only $706.1M if the county profile mirrored the national age distribution. To put that into perspective, the total value of all single-family Flagler County homes sold through the Flagler County MLS in 2019 was $721.2M.
FLAGLER COUNTY HEALTHCARE REVENUE BY AGE GROUP
MedNex will not be a medical school. It will not be turning out physicians. MedNex will be creating trained and certified graduates in many of the growing disciplines that support today's medical practices and hospitals, including:
All averaging $76,000 salary per year, plus the faculty and administrative staff for MedNex.
Florida and the nation face a looming shortage of qualified healthcare professionals. An analysis by Self Financial shows that Florida has 3.69 healthcare workers per 100 residents. The national average is 3.90 per 100 residents. This disparity is magnified by the higher percentage of aged 65+ residents in Florida. Clearly, we have a lot of catching up to do.
The tragedy of 911 spawned an admiration and appreciation of first responders. First responder hero-worship drew a wave of young people who wanted to be one of them. In the same manner, Covid-19 spotlighted the critical importance of the healthcare industry and its supply chain. Healthcare workers have become the new heroes. A new wave of young people who wish to serve will be drawn to medical professions. MedNex will lead the way.
One way to solve an affordability problem is to lower housing costs. This has proven to be unsuccessful and is likely unattainable. (Commentary: Confronting The Illusion of Affordable Housing) Another approach is to raise the median household income. MedNex will certainly help to accomplish that goal. Higher median household incomes will mean less pressure for affordable housing.
Some have argued against MedNex because it would be a non-profit, exempt from real estate taxes. Ironically, MedNex will be within the SR 100 Community Redevelopment Area (CRA), meaning that additional tax revenues arising from future increases in real estate assessed value would remain within the CRA anyway. Keep in mind, the county’s largest public-sector employer, Flagler Schools, and its largest private-sector employer, AdvenHealth, are both non-profits but their employees own homes, pay taxes, and support our local economy.
In a larger sense, higher education centers, especially those with a technical focus, often turn into regional incubators for entrepreneurs and subsidiary support businesses. These businesses will tend to be clean tax-paying industries with well-paid employees. MedNex, as a med-tech hub, will be a magnet for talent and investment that will spawn cutting-edge research in pharmaceuticals and medical devices. We are about to experience economic development at its best.
Toby Tobin: REALTOR®
I'm a licensed Florida REALTOR® affiliated with Grand Living Realty in Palm Coast, Fla. As a real estate consultant to developers/builders, homebuyers, and sellers, and as a journalist, I have years of experience and a treasure trove of relevant data and local institutional knowledge.
Call me at (386) 931-7124 or email me at Toby@GoToby.com.
Listen to my radio show, Real Estate Matters, every Saturday morning right after the 11:00 A.M. news break on WNZF News Radio at 1550 AM or 94.9 FM. Download the Flagler Radio App from the App Store so you can hear Real Estate Matters from anywhere in the world.