Pet ownership is showing no signs of slowing down, especially among high-earning millennial homeowners who are starting their own families. According to the most recent statistics provided by the American Pet Products Association, 66% of U.S. households own a pet. Pet ownership has especially proliferated due to the work-from-home/hybrid work week schedules that continue to be the new normal, as workers spend less time commuting and can therefore devote more time interacting with their pets. Consequently, the neighborhood veterinary clinic continues to be a popular retail center tenant within suburban and residential-oriented urban markets. Inline spaces within grocery-anchored retail centers and retail street-front sites tend to be targeted. Second-generation sites, including former banks, work well for these veterinary tenants. The national brands that are currently revving up their expansion goals include GoodVets, Petfolk, Bond Vet and PetWellClinic.
Thanks to an investment in September from the General Atlantic growth equity firm, GoodVets anticipates opening between 20 and 30 new units per year over the next two to three years. By year’s end, GoodVets intends to open its first units in fast-growing markets located within new states for the brand, including in James Island, S.C. (with a second location in West Ashley that will open in 2024), as well as Dallas, Brooklyn, N.Y., Phoenix, Washington, D.C., and Hermosa Beach, Calif. These locations top off a year which also included four units that opened in Georgia, another new state for the brand. In addition, continued growth will take place in Kansas, Colorado, Florida and Ohio, with more new markets in Texas and California being eyed.
Ideal square footage requirements for GoodVets include spaces in the 2,500- to 5,500-s.f. range. Preferred spaces are inline or end cap units in grocery-anchored centers or retail street-front sites — including the ground floor of mixed-use buildings — within mid- to higher end urban or suburban neighborhoods. Second-generation sites work well, as evidenced by its recent unit that opened in South Denver in October in a former FirstBank, which Mosaic Construction remodeled for GoodVets. Co-tenants should include daily errand and dining brands such as The UPS Store or Tropical Smoothie Cafe, as well as medical/health and fitness retailers such as Aspen Dental, CVS Pharmacy or F45 Training. GoodVets, which partners with veterinarians interested in owning their practice, prides itself on its modern, luxurious spaces that provide elevated pet health services, including urgent care.
Bond Vet is on track to open between 20 and 25 new units per year over the next two to three years. This is mainly due to its $50M funding round that took place in October, led by the private equity firms Warburg Pincus and Talisman Capital Partners. In addition, to gear up for growth, Bond Vet hired a new CEO in June, the former COO of VCA Animal Hospitals. Because Bond Vet has such a strong presence in the Northeast, look for future expansion to extend toward the Southeast, with the Carolinas and Georgia on Bond Vet’s radar. Also expect a slight westward push into states such as Pennsylvania and Ohio, which are situated between the Northeast coast and Chicago, a city that is currently the only Midwest presence for the brand with three units. As for immediate growth, Bond Vet will continue to open new units in all markets in New York, New Jersey and Massachusetts.
Preferred locations for Bond Vet are inline or end cap spaces between 2,000 and 2,500 s.f. in retail street-front sites, ground floors of mixed-use centers, lifestyle centers, power centers or grocery-anchored neighborhood centers. Sites should be either within residential-oriented urban metros or highly populated suburban communities. Co-tenants should include restaurants, health and errand brands that appeal to higher-earning millennials such as Sweetgreen, Pure Barre and Whole Foods Market. Bond Vet provides primary and urgent care services for pets in an aesthetically pleasant spa-like setting and offers late-night hours to accommodate all schedules.
Having only been in operation for two years now, Petfolk plans to have 11 veterinary centers in total by year’s end and will open approximately 20 new units per year in both 2024 and 2025. This is a result of the Petfolk team raising $40M in Series B funding last month, led by the growth equity firm Movendo Capital, which adds to the $40M that was also raised in August of 2022, led by the White Star Capital investment firm. Expect the Petfolk expansion to continue to be centered on the Southeast, with a push into the Southwest with a unit opening in Texas, a new state for the brand, by year’s end in Dallas. South Carolina, another new state for the brand, is also being eyed. In 2024, continued expansion will take place in states where Petfolk already has a presence, including Miami, Raleigh and Charlotte, N.C.
Square footage requirements for Petfolk are inline or end cap units between 1,500 and 3,000 s.f., which are located in lifestyle centers, grocery-anchored centers, power centers and neighborhood shopping centers within robust suburban communities. Co-tenants should include daily errand and dining brands that appeal to high-earning millennials, such as Trader Joe’s, Five Guys and CorePower Yoga. Petfolk is known for its technology-driven, best-in-class quality care within a warm, community-focused setting.
PetWellClinic expects to finish 2023 with 15 new units and anticipates continuing its trajectory of opening 15 to 20 new units per year over the next two years. Recent franchise agreements have guaranteed further growth over the next two years into such markets as Washington, D.C., and its surrounding areas of Northern Virginia and Maryland, as well as Phoenix, Detroit, Denver, New York City, South Florida, South Orange County, Calif., and Eastern Massachusetts.
Preferred spaces for PetWellClinic should be inline or end caps between 600 and 1,200 s.f., located in mid- to higher end grocery-anchored centers and strip malls within high-traffic suburban or urban metro retail districts. Ideal co-tenants include coffee brands, such as Starbucks, and fitness brands, such as Planet Fitness. PetWellClinic is known for its walk-in service, affordable pricing and its own proprietary software that tracks wait times for customer convenience.
