Wellness comes to the local shops

An hour at the shops can now include a workout, a treatment or a health appointment before anyone reaches the supermarket. For shopping-centre owners, the appeal of health and wellness is easy to see: it gives customers another reason to visit, and one they may put in the diary each week.

At Westfield Bondi, the idea has taken substantial form. Former department-store space has been repurposed into a health, wellness and fitness precinct featuring Virgin Active and rebel. Scentre Group says the precinct contributed to an 8.5% increase in customer visitation in 2025. (Scentre Group)

For owners taking back department-store floors, that is an encouraging example. A large vacancy brings an uncomfortable combination of missing rent, building costs and decisions about the centre's future. A business that can occupy substantial space and bring people back regularly deserves attention.

Smaller centres have fewer square metres to play with. Their available space may amount to a handful of shops, and a destination wellness club may be well beyond the budget. Yet their customers also want to exercise, look after their health and get through the week's errands.

Can the local centre win a share of that routine?

An appointment beside the weekly shop

Consider a parent finishing a Pilates class after the school run, with time to collect groceries before going home. Or a patient leaving a health practice and picking up a prescription a few doors away. Neither journey requires a grand redevelopment. Both depend on the right services being close together and easy to use.

That gives smaller centres a plausible way to compete. A useful appointment, conveniently located, may be enough to influence where someone shops. The opportunity starts with what people nearby need and can afford, whether that is physiotherapy, a modest exercise studio or another service missing from the area.

Pavilions Palm Beach on the Gold Coast provides an earlier example. In September 2022, owner Consolidated Properties Group reported that the Coles-anchored centre's 1,250 sqm health-and-lifestyle precinct was fully leased across eight tenancies. The mix included medical and dental services, a pharmacy and F45. Flow St8 Studios had taken a 175 sqm tenancy on a seven-year lease with options. (Consolidated Properties Group)

The studio's operator described the appeal in everyday terms: customers could train, have a coffee and get what they needed from the supermarket. The report does not quantify the benefit to neighbouring shops or the landlord's return on the building work. It does show leasing take-up for a group of businesses assembled around health and local convenience.

The direction also features in institutional owners' thinking. In its April 2025 retail outlook, ISPT, which joined IFM Investors in December 2024, described smaller centres diversifying their offers and income through medical and allied-health services. Head of Portfolio (Retail) Sam Curry linked that diversification, alongside consumers shopping more locally, to his expectation of growing investor appetite for these assets. (ISPT's 2025 Retail Outlook)

That observation supports the case for local health services. A discretionary fitness membership still needs its own customers and its own commercial case; the wellness label covers businesses with quite different economics.

Convenience has to work both ways

The promise of an easier visit can come undone in the car park. A popular class occupying spaces through the supermarket's busiest period may suit its members while making life harder for grocery shoppers. A café will gain little from an early workout if it opens after everyone has gone home.

Those details help determine whether a new tenant becomes part of the centre's daily life or simply rents space beside it. Entrances, opening hours and the route between businesses deserve attention before the lease is signed.

So does the local customer pool. Several studios offering similar memberships may end up dividing the same demand. A complementary service could give the centre more than another version of an offer already available nearby.

For a sub-regional centre with a larger vacancy, there may be room to divide the space between an exercise business and several appointment-based services. That offers flexibility, although subdivision brings costs of its own. Introducing the businesses gradually can allow the owner to learn from the first tenant, provided the initial building work leaves sensible options for the space that remains.

A neighbourhood centre may need to begin with only one shop.

The business beneath the idea

An awkward unit that has struggled to attract retailers could find a useful tenant in a health practice. A productive shop beside the supermarket entrance presents a different choice. In each case, the comparison is with what that particular space could realistically earn from another use.

The expected rent has to justify the incentives and building work, with some thought given to what happens if the operator fails. An attractive fit-out and a busy opening week say little about whether the business can sustain the lease.

Benefits to the rest of the centre need similar care. A customer moving their usual grocery trip to class day has combined errands, but has not necessarily spent any more. Additional café sales are welcome; they do not automatically repay the landlord's conversion bill.

For smaller centres, the opportunity is to make health and fitness fit comfortably into ordinary life. That means choosing businesses local people will use regularly, in premises those businesses can afford, without making the existing shopping trip harder.

One viable practice paying sustainable rent in a previously empty shop can be a worthwhile result on its own. If it also brings demonstrable trade to its neighbours, the case becomes stronger. That gives an owner a sound basis for the next leasing decision, and a way to participate in wellness without committing to a destination-sized development.

Locyra draws on public reporting and Loculyze's property-analysis frameworks. This article is commercial commentary, not a centre-specific financial assessment, and uses no confidential client data.