When Sandra and James Hoskin were leasing a small retail space in front of a Houston hotel in 1987, their landlord evicted them. He was selling the property to a buyer who needed the space.
Vowing never to lease again, the co-owners of American Medical Equipment soon began property-hunting. This was the late '80s, when “real estate wasn't moving at all,” Sandra recalls. But the stale market ultimately worked to the couple's advantage when they found a rundown piece of real estate — with enormous potential.
“The owner really wanted to get rid of it,” Sandra says, adding that he actually dropped the price $100,000 and was willing to finance the purchase himself.
The area had trash on the streets and relatively light traffic, “but it didn't take long for that to change,” she says.
A few blocks away stood the outskirts of the Texas Medical Center, today one of the largest employers in Houston. The center had yet to expand toward the property, “but we knew the land would increase in value,” Sandra says.
They were right. The land remains the last privately owned acre within the medical center complex. It sits on a major thoroughfare, and the medical center's parking lot surrounds the Hoskins' property, on which stands a new 30,000-square-foot building housing 12,000 square feet of retail space.
Growing with the Business
For its first 16 years on the property, the HME company survived in half the space. But as the company grew and added product lines, eventually “there wasn't any place to put them,” Sandra explains.
Many customers also found it difficult to reach the space. Grandfathered into ADA compliance because of its age, the original building had three steps leading to the front door. Wheelchair users had to enter from the bay doors in the warehouse behind the retail showroom. Even the restroom wasn't handicap-accessible.
So last year, the Hoskins “decided to bite the bullet and build a new place,” Sandra says. Because the couple owns the property and leases it back to the business, a new, bigger building meant “we were building assets, and [we] didn't have to worry about having to move.” American Medical has now been on the same acre for 17 years, she adds, so “everybody knows where we are.”
When construction began, the company moved its warehouse offsite, tore down the old warehouse and built the new building in its place. The company used its existing retail space during construction until the move into the new building, after which the old retail space was torn down to make room for a large parking lot.
Designed by local architectural firm Morton Levy and Associates, the $2 million building includes an extra 12,000 square feet on the second floor, which the Hoskins plan to lease to physician groups — convenient for referrals to the business downstairs.
And this time, wheelchair users can maneuver the space. The storefront has a minimal incline into doublewide automatic doors. Restrooms are handicap-accessible, aisles are wide, and one checkout counter is positioned at wheelchair height.
Since opening the showroom in November, retail business has grown by a third and now accounts for roughly 25 percent of all company revenue. “Retail is a huge cash business,” Sandra says, “and there are times when that has supported our … third-party-payer business because of the lag in time getting paid.”
Owning the building's parking lot allowed the Hoskins to get creative and better serve their growing customer base. During building construction, Sandra had an idea while visiting a Sonic fast-food drive-in. If Sonic could provide service to people in their cars, so could her HME company.
Today, two parking spaces with adjacent radios feature curbside service. Customers place their orders, and store representatives wearing headphones and belt packs deliver those orders right to their cars. “[Our] handicapped patients are thrilled,” Sandra says.
Selling Systems
The company sells a wide variety of supplies and equipment, from ostomy bags to hospital beds, and can “put entire home care systems” together for walk-in customers, Sandra says.
A bed-confined patient obviously needs a hospital bed — but that patient also may need a trapeze, a hydraulic lift or other related products. Three alcoves in the showroom organize the systems, showing complementary products, accessories and aids for bedrooms, bathrooms and bariatrics.
The showroom also includes a large section for scrubs and other medical uniforms, drawing traffic from medical center employees driving by, and an entire wall devoted to ADLs and incontinence supplies on gravity-feed racks.
Such organization helps more than just the retail business. Consider customers with two or three prescriptions. They may come in for a patient gown, then see the store has other insurance-covered items they need. They might have planned to go somewhere else, Sandra explains, “but they don't. “It's right there. They see [the products] in front of them.”
And the products the customer sees must pass Sandra's muster. “We don't buy any of the real inexpensive equipment,” she says, because selling cheaper equipment and increasing profit “wouldn't compensate for my piece of mind. I get upset when I see people providing the cheapest [products] they can. The beneficiary may get hurt … [and] that really bothers me.”
Sales employees must pass Sandra's muster, too. A registered nurse, she hires only properly trained and certified staff.
Site Specific
When Sandra and James first opened their HME in 1984, Houston was slipping into recession. They bought their current property at the height of the country's real estate downturn, and they built their new building in 2003, with the economy still on shaky ground — in a city that's the bullseye of a government crackdown on power wheelchair fraud and abuse.
But location means everything in real estate (“location, location, location,” the adage goes), and their property has seen the Hoskins' company through it all. “When things get bad, we think we'll probably expand,” Sandra jokes.
The couple turned down a $1 million offer for the land because they felt that no other piece of real estate in Houston could benefit their business more, so selling the property was simply not an option. The medical center “has tried real hard to get my property,” Sandra says, but so far, the couple has stood their ground — literally.
Indeed, the Hoskins' land made American Medical Equipment's new building and healthy growth possible. The JCAHO-accredited company employs 35 at its new flagship store and 25 more at seven branches in Florida, Louisiana, Mississippi, Texas and West Virginia. Together, they generate approximately $7.5 million in annual revenue.
Sandra has even been named one of the “Top 50” women in business by the Houston Business Chronicle.
And with its new, expansive retail space, American Medical Equipment stands ready to serve growing consumer demand. “We have everything that anybody could possibly need,” says Sandra.
