The Vaccine Rollout Has Been A Mess. Real Estate Can Help Fix It

For the past 10 months, the real estate world has pointed to the coming of the vaccine as the industry’s salvation. Now, experts say that involving real estate in the distribution process could be the best way to improve the lackluster rollout of the vaccine. 

In order to effectively inoculate enough of the population to reach herd immunity, the federal government must leverage existing supply chains while state and local governments should collaborate with real estate to utilize empty storefronts and offices as vaccination locations, logistics and health experts say.

“[Real estate] is in the business of location, location, location,” City University of New York Professor of Health Policy and Management Dr. Bruce Y. Lee said in an interview. “They can play a significant role in identifying vaccination locations and creating vaccination locations.” 

So far, the rollout nationally has been a mess. Before vials even reached the United States, the public health community warned a lack of planning could imperil the vaccine effort. Still, guidelines from the federal government on how to mobilize a vaccine movement have been sparse and lack specificity. 

States have been left to create their own distribution plans and the nation fell far behind its goal of inoculating 20 million Americans by the end of 2020. Around 12.3 million Americans were vaccinated as of late last week, Reuters reported.

The lack of public-private partnerships and cross-sector collaboration in the distribution process has been a huge factor in the delay, experts say. Many state task forces on distribution around the country rely solely on the expertise of medical providers and other health systems and not other parts of the business world.

“From my perspective, we need to rapidly move outside the health care sector for vaccine distribution,” Massachusetts General Hospital Physician-in-Chief Dr. Katrina Armstrong told Bisnow. “If we leave it solely on the health care sector, I worry that we’re going to continue to struggle.” 

In New York, where Gov. Andrew Cuomo’s distribution task force contains medical providers, state officials and nonprofit leaders, the distribution methodology has been opaque. State Sen. James Skoufis, a Democrat who represents three counties in the Hudson Valley, told Bisnow that during an hour-and-a-half-long meeting between legislators and the health commissioner, lawmakers could not “get a straight answer” on the details of the state’s distribution plan. 

He had been hearing complaints about the system from both individual constituents trying to get the vaccine and providers in his area. The federal government “bears much of the blame,” especially when it comes to supply problems of the vaccine, Skoufis said, but he feels that the state was woefully unprepared as well. 

“It’s remarkable because we’ve known for a better part of a year that the vaccines are coming,” he said. “We had months to prepare.” 

Other states, like West Virginia, have seen success, mostly due to their ability to steer away from the general federal plan and come up with one that fit the needs of the people in the state, The Wall Street Journal reported. 

Wide-ranging issues with the vaccination process nationwide range from poor communication to a lack of efforts to combat mistrust in the vaccine to inaccessible vaccination locations.

Health experts and real estate officials alike hope that newly inaugurated President Joe Biden, who has made battling the coronavirus his top priority and laid out a clear federal plan for distribution, will involve the private sector in conversation.

Amazon has already offered to lend a hand. On Wednesday, officials from the e-commerce behemoth sent a letter to Biden, saying it was ready to help in "vaccinating 100 million Americans during the first hundred days” of his presidency.

Companies like Amazon that are leaders in distribution could be key. The way the system works now, the federal government distributes vaccines to states and then each state distributes it to providers, experts say. Localities have struggled to get the vaccine directly to patients because of geographic challenges.

“If a testing site is on one side of the freeway, we need to understand how we’re going to get the vaccine to those on the other side of the freeway,” Lee said. “That’s crucial.” 

Private sector real estate has spent decades perfecting the art of distribution to get goods out to large swaths of the population quickly and efficiently, logistic real estate experts say. There are even e-commerce distributors, such as Express Scripts, that focus specifically on getting pharmaceuticals to the public. 

“We’re not totally starting from scratch, in theory,” said Michelle Comerford, a national site selection consultant for the logistics industry with Biggins Lacy Shapiro & Co. “When it comes to the logistics, we have companies literally doing just this.” 

Biden’s new administration must collaborate with big businesses, such as Walmart, Target, UPS and FedEx, to get this done, logistics experts said.

“There has always been an issue with the last-mile logistics. However, there have been companies that have found ways around this,” said Greg Boler, a partner in Transwestern Development Co.’s logistics group.

“[The federal government] has the power to leverage these larger companies that already have these last-mile logistics systems," Boler said. "This is what they do on a day-to-day basis, you need to have these experts as part of the conversation, but it starts on a federal level.”

Some states have already recognized the importance of utilizing space and the logistics sector in order to get the vaccine in arms. Washington State announced it will partner with Starbucks to distribute vaccines.

Public-private partnerships have already been proven to be a key element in fighting the coronavirus. It was those partnerships that led the federal government to develop a vaccine as quickly as it did, Comerford said.

Creating small and midsized sites out of vacant real estate could also help the issue of geographic accessibility, New York state Sen. Skoufis said.

“By definition, real estate has space and unfortunately, because of the pandemic, a lot of that space is going unused,” he said. “There are all of these megasites but why not partner with real estate to set up medium-sized sites in unused office space or retail space where it is really needed."

Some spaces are already being used in this way. In Southern New Jersey, a vacated Lord & Taylor department store in a mall is being used as a vaccination center. The same is happening in Loudoun County in Virginia at a shuttered Nordstrom, with the county agreeing to an eight-month, $2M lease with the owner of the mall to prop up a vaccine distribution site.

Local pharmacies have been eyeing space to use as vaccination centers as well. Pharmacist Society of the State of New York President Tom D’Angelo, who owns a local pharmacy in the New York City suburbs, said that he had some vacant real estate that he will use as a vaccination site. This could supplement the use of megasites like those at New York City’s Jacob Javits Convention Center, he said. 

Tom Griggs, head of industrial and logistics for the East Region at Hines, said he is “actually surprised” that empty real estate has not been more frequently used for this already. 

“Think of all the dead retail space right now,” he said. “I think there is definitely a role for real estate in all of this.”

If the government immediately starts collaborating with those in the private sector, including real estate, the country’s vaccine distribution outcome could turn around.

“If we can use this moment to have the government support the private sector in helping with this rollout, we may be able to get a lot more vaccines out faster,” Armstrong said.