Wellness is everywhere nowadays as consumers of all ages look to improve their mental and physical health. Consumers are increasingly seeking out buildings, homes, and communities to help them live healthier lifestyles, leading to a surge in demand and investment in wellness real estate within the commercial market.

The Global Wellness Institute (GWI) recently released a new report, 2024 Wellness Real Estate: Market Growth (2019-2023) and Future Developments, showcasing the latest data and insights on the wellness real estate sector. This sector has skyrocketed in the last six years, growing from $225.2 billion in 2019 to $438.2 billion in 2023—an annual growth rate of 18%. In comparison, the annual growth rate for overall global construction was only 5.1% during the same time period.

GWI predicts that the wellness real estate market will grow by 15.8% annually from 2023 to 2028,  potentially approaching the trillion-dollar mark at $912.6 billion. The report also explores the biggest opportunities and challenges that the wellness real estate market could face in the future. Below are the key findings from the report:

Largest markets

• The United States accounts for 41% of the global market in 2023.
• The United States and Canada, plus a few select countries in Asia (China, Australia, Japan) and Europe (United Kingdom, France, Germany), account for 85% of the global market. 
• Average annual growth rates for 2019-2023 have remained quite high across all the largest country markets, and many of the countries on this list have been growing faster than the global sector average (18.1%) during this time period. 

Wellness building certifications

• Interest in wellness certifications has risen rapidly since 2017, with the total number of wellness-certified building projects increasing by more than forty-fold from then to 2023.
• The WELL Building Standard (WELL) and Fitwel are the two major third-party rating systems that focus specifically on the health and wellness of building occupants and that operate in multiple countries. 
• At the end of 2023, there were over 3,300 WELL and Fitwel-certified projects worldwide. Over 55% of these certifications are located in the United States. 
• The majority of the certifications are for office/commercial, hospitality, and retail properties, with about 19% in residential projects. As of March 2024, an additional 1,800 projects were in progress for certification (Fitwel) or precertified (WELL); most located in the United States, China, and Canada.

Key drivers and opportunities for wellness real estate

• Healthy indoor air is becoming increasingly important in a post-pandemic era and regions experiencing declining air quality due to climate change.
• Future wellness real estate projects will increasingly incorporate natural assets such as parks, natural areas for outdoor recreation, landscaping, trees, and green public spaces. Many also advocate for equitable distribution of, and better access to, these natural assets for traditionally underserved populations. 
• Thoughtful environmental design can improve mental and social wellness for all. Pro-social design features make people feel more connected to one another and encourage spontaneous social interactions that are improve well-being. Green spaces and biophilic elements have been proven to relieve stress, illicit positive emotions, improve cognitive functioning, and accelerate healing.
• Luxury and wellness are becoming increasingly linked. Wellness amenities for luxury properties in the future will encourage contact with nature, mindfulness, sleep, and other aspects of mental and social wellness. GWI predicts that many of these features will increasingly be found in mid-market and affordable properties, including purpose-built rental communities of single and multifamily homes. 
• Wellness tourism will lead to the development and purchase of wellness properties. Major destination spas and luxury hospitality brands are developing branded residences (e.g., Six Senses, SHA, Canyon Ranch, Rancho La Puerta, Aman Resorts, Mandarin Oriental, Mission Hills Spa, GOCO Hospitality, etc.) adjacent to their existing properties and in urban areas.
• Wellness-centered workplaces can help entice people to return to the office. In a global commercial office market with excess capacity, commercial tenants can demand more value for their leases, including better wellness features and upgrades. This dynamic will continue to increase demand for wellness real estate in the commercial real estate market. 
• There is vast potential for differentiation in wellness real estate to address diverse needs and audiences. Consumers in major cities may be most concerned about air and water quality, noise pollution, mental wellness, and access to green spaces, fitness, and other wellness amenities. Those in large suburban developments may be seeking better walkability and mass transit options, bike paths, and more outdoor recreation options to better connect with their neighbors.

Key challenges facing wellness real estate

• The effects of climate change will drive demand for climate-adaptive features in wellness real estate. Buyers, investors, and developers of wellness real estate have to contend with many new and emerging risks, and adaptability and resilience will need to be crucial parts of the wellness framework. 
• Rising temperatures threaten the health and safety of workers worldwide, and construction workers are among the occupational groups that suffer the most from extreme heat. Developers should take precautions to care for the workers' health as they work to create wellness-centered buildings that will help others in the future. 
• An overall premiumization trend is widening the gap between the ultra-wellness real estate built for the wealthy and the housing built for the average family. At the middle and lower end of the market, buyers are seeking a more basic range of wellness-supporting features. Builders of wellness real estate should ensure they can serve the needs of these important consumers. 
• The regulatory environment for construction and urban planning frequently stands in the way of wellness real estate and healthier-built environments. Construction is mostly regulated at the local level, and in cities all around the world, there are regulations that prohibit healthier urban design and building practices.

GWI defines wellness real estate as buildings, neighborhoods, and communities that are proactively designed and built to support the holistic health of their residents, occupants, and visitors. While wellness certifications and rating systems are a useful signal to tenants about what wellness features a building offers, the organization notes that wellness real estate is not limited to those developments that have obtained certifications. Wellness real estate is extremely diverse, and in estimating the size of the market, GWI acknowledges that it’s not possible to create a checklist of what does and does not count as “wellness real estate.” Although they weren’t measured in this dataset, buildings and spaces that are designed to address different aspects of our health and well-being by improving physical wellness, social wellness, spiritual wellness, and environmental wellness can give residents the same benefits as purpose-built wellness real estate.

“When governments invest more in health-enhancing and environment-protecting infrastructure at the neighborhood, community, city, and regional levels, purpose-built/privately developed wellness real estate may become less necessary,” the report reads. “These kinds of public investments can include active design, public transit, public parks, trails, sports and recreation facilities, community centers, community events, and much more. However, until populations around the world have direct access to these kinds of healthy built environments, wellness real estate will continue to see rising demand and adoption in the foreseeable future."