From Toys To Healthcare: The Medical Adaptive Reuse of Former Toys R Us Properties
Higher construction costs and elevated interest rates have led to the repurpose of existing Big Box real estate for healthcare use -- including multiple former Toys R Us stores
2024 marked one of the lowest years for new medical office building (MOB) construction starts in the past decade.
However despite this slowing of new construction, leasing at MOBs actually increased 15% in 2024.
So what gives?
Higher construction costs and interest rates likely contributed to slowing new construction of MOBs and other health care properties.
But fortunately another form of developing health care real estate has picked up some of the slack:
The adaptive reuse of former Big Box retail buildings as healthcare properties.
Especially real estate vacated by bankrupt retailers like Toys R Us.
In fact at least a dozen former Toys R Us stores have been repurposed as MOBs and healthcare centers.
The Toys R Us Building in Pennsylvania That Still Serves Children
Children once flocked to the former Toys R Us in Lancaster County, Pennsylvania to scour the aisles for toys and games.
They still come to the former toy store building — only now to receive health care.
Opened in June 2022, the Lancaster Pediatric Center of Penn State Health is an adaptive reuse of a former 47,000 square foot Toys R Us store.
The pediatric outpatient facility provides Lancaster County children with access to top pediatric specialists from Penn State Health's Children Hospital.
It offers 20 onsite medical and surgical pediatric specialties as well as imaging and lab services, behavioral health treatment and primary and walk-in care for children.
A Pair of Former Toys R Us Buildings Now Offer Care to U.S. Veterans
The U.S. Department of Veterans Affairs has opened a pair of primary care clinics in former Toys R Us buildings.
The 42,000 square foot clinic that opened in Des Moines, Iowa in 2022 supports Patient Aligned Care Teams (PACT), a patient-driven model that provides veterans with personalized, team-based healthcare that is focused on wellness and disease prevention.
It also offers physical and occupational therapy, x-rays, pharmacy and telehealth services to over 30,000 veterans in Central Iowa.
The North Pinellas VA Clinic in Clearwater, Florida also opened in 2022 in a former Toys R Us.
The outpatient clinic offers a variety of primary cares that include family and internal medicine as well as behavioral health.
A “Big Box” Outpatient Medical Center in Pittsburgh
The University of Pittsburgh Medical Center (UPMC) converted a 46,000 square foot former Toys R Us near the Century III Mall in Pittsburgh into an outpatient medical center.
It offers care in over 20 specialties, as well as diagnostic imaging services, an outpatient surgery center with four operating rooms, and an after hours pediatric urgent care clinic.
What To Look For in 2025
Even though Toys R Us filed for bankruptcy in 2017 — and the majority of its real estate has since been re-tenanted or repurposed — there are still several Toys R Us-to-healthcare conversions opening in 2025 which include:
Kaiser Permanente Health Clinic in a former Salinas, CA Babies R Us Store
In January 2025 Kaiser Permanente opened a clinic in Salinas, California that offers primary and specialty care and has 20 exam rooms, a pharmacy, lab and imaging services.
It is located in the Boronda Crossing Shopping Center.
And is an adaptive reuse of a 24,000 sq ft Babies R Us.
Toys R Us-to-Integrated Care Medical Center in South Florida:
Baptist Health South Florida acquired the 58,000 square foot former Toys R Us building in Royal Palm Beach, Florida for ~$16 MM in January 2019.
Now more than six years later plans have been set for the adaptive reuse of the building.
The healthcare facility is set to include ~31,000 square feet of area for outpatient services, ambulatory surgery, diagnostic imaging, lab facilities and physician offices.
The remaining ~27,000 square feet of the building will be a 24/7 emergency room with 18 beds.
While the majority of former Toys R Us sites have been repurposed, other recently closed Big Box stores offer additional real estate with health care conversion potential.
So that vacant former Bed Bath & Beyond store or the Joann Fabrics building where there is a going-out-of-business sale?
Their next uses may just be as an MOB or health care center.