Outpatient Projects (July 2006)

Norton’s new MOB is just the beginning

HEALTH SYSTEM HAS BIG PLANS FOR DOWNTOWN AND EAST LOUISVILLE CAMPUSES

 

By Sonja Pedersen-Green

Even though Louisville, Ky.-based Norton Healthcare earlier this month opened the $20 million first phase of a new campus in the fast-growing eastern part of town, it has no plans to neglect its flagship hospital. In fact, Kentucky’s largest healthcare provider plans to start a $24 million redevelopment of its downtown campus next spring.

The first phase of Norton’s $166 million development at Old Brownsboro Crossing in east Louisville opened July 10. The $20 million Norton Medical Plaza at Old Brownsboro Crossing is a three-story, 86,000-square-foot medical office building (MOB).

Construction of Norton Medical Plaza began in May 2005 and the building shell was completed on schedule. Some tenants spaces have been completed, while build out continues for several others.

Plans call for the MOB to be connected via pedway to a new 127-bed, $146 million acute care hospital on 15 acres. Construction of the 80-bed first phase of the adjacent hospital is scheduled to start next spring with completion slated for January 2009. Another 47 beds would be completed by late 2011.

“We have been overwhelmed by the positive reception that Norton Healthcare has received to bring important, nearby healthcare services to residents in the fast-growing Old Brownsboro Crossing area,” COO Russell F. Cox of the private, not-for-profit system said in a prepared statement. “Community input has been instrumental to us in planning Norton Medical Plaza and our new hospital and the services that we plan to provide at these facilities.”

Norton Medical Plaza is in the new 114-acre Old Brownsboro Crossing development, just east of the intersection of Interstate Highways 71 and 265 in east Louisville. It is being developed by Main Street Realty, which is owned by David A. Jones, founder and retired chairman of Louisville-based Humana Inc. (NYSE: HUM), one of the nation’s largest publicly traded HMO and PPO companies.

The general contractor for Norton Medical Plaza is Marksbury Cornett of Middletown, Ky., and the project architect is Michael Koch & Associates of Louisville.

Meanwhile, at its late 1950s/early 1960s vintage downtown campus, Norton plans to demolish three aging structures and replace them with green space and a new 14-story building, which will contain medical offices and parking.

Norton will add on to its existing surgery center and parking structure, which is south of Norton Hospital, to create the new MOB. Plans call for adding four stories of parking to the existing four-story structure. The current structure contains more than 30 operating rooms and three floors of parking.

While construction of the MOB is scheduled to begin next spring, the entire project, which will cost Norton about $24 million, will take five to 10 years to complete.

It is anticipated that a third-party developer – which has not been publicly named – will add another six floors to the facility. Each floor will add about 32,000 square feet of space, for a total of about 192,000 additional square feet. This addition will be primarily medical office space. The developer’s portion is expected to cost between $40 million and $50 million.

Norton plans to demolish the 56-year-old Norton Healthcare Service Building, the 26-year-old Medical Towers North building and the 44-year-old Medical Towers South building. The structures will be demolished in phases. The first building to be demolished will be Medical Towers North. In 2009, Norton will demolish the Healthcare Service Building, and in 2010, the system will deconstruct the Medical Towers South building.

It is anticipated that tenants in the Medical Towers North building will begin moving out of the building during the next several months. Most of these tenants will be relocated temporarily to other Norton facilities.

Holy Family adds

to outpatient space

in Spokane, Wash.

Construction began in recent weeks on a facility that will bring more than 100,000 square feet of new and renovated outpatient and medical office space to the fast-growing North Side of Spokane, Wash.

The project, which kicked off with a $28 million first phase back in 2003, is an expansion of outpatient services provided by Holy Family Hospital, whose outpatient volume is growing faster than its inpatient volume, according to hospital officials.

The project is a collaboration of Holy Family Hospital and its parent company, Providence Health and Services, as well as several local physician groups and Denver-based development firm NexCore Group LP, which developing, financing, leasing and will own and manage the medical office portion of the facility.

The first phase included a new emergency center; a consolidated, expanded imaging center; renovation of the hospital’s entries, lobby, corridors and wayfinding system; and other facility improvements. The second phase includes a four-story, 65,800 square foot medical office component atop 33,200 square feet of expanded outpatient space, plus an 8,550 square foot renovation of existing hospital space. A new, 300-space surface parking lot will also be constructed.

Three major tenants have signed leases for new medical office space, according to NexCore.

Two healthcare

companies join Campanelli

to create cancer center

WEYMOUTH, Mass. – Denver-based HealthOne Care System and Quincy, Mass.-based Commonwealth Hematology-Oncology (CHO) have joined forces with developer Campanelli Cos. of Braintree, Mass., to build a cancer center in the new Weymouth Woods Medical Center. Weymouth Woods will be home to the first comprehensive cancer treatment center on Massachusetts’s south shore.

The facility will include on-site radiation therapy services, and developers also envision pediatric hematology and oncology services and support services such as nutrition and counseling.

HealthOne Care Systems and CHO have leased approximately 32,000 of the 68,363 square foot Weymouth Woods Medical Center. The medical center was deigned by R&K Architectural Associates, also of Braintree.

The cancer center is scheduled to open in spring 2007 and will be the center’s largest occupant. Patients from all community-based practices, including HealthOne Care System affiliated groups, will be able to use the cancer center’

 

For the record

JER Partners of McLean, Va. is spending $75 million to acquire securities from Chicago-based Aviv Healtcare Properties. Aviv will then use the capital to purchase real estate in skilled-nursing or other health care-related facilities… Raleigh, N.C.-based WakeMed Health & Hospitals has filed three Certificate Of Need (CON) applications with state regulators. One of these applications is for a “hospital without beds” that would expand WakeMed’s three-hospital system into eastern Wake County. The proposed facility would cost $23.9 million… Plaza Cos. of Peoria, Ariz., plans to develop a new two-story, 46,000 square foot MOB as the second phase of the Rancho Santa Fe development in Avondale, Ariz. The 2.83-acre lot was purchased for $861,616 and the total cost of the project is estimated to be $11 million. The groundbreaking is scheduled for fall 2006 and a contractor will be selected sometime this summer…Solomon Development and N.C.-based Corporate Realty Advisors are partnering to build a mixed-use development near the Hendersonville (Tenn.) Medical Center. The two companies bought the land last April for just under $1 million and the construction will cost about $8 million. The space will sell for about $23 to $24 per square foot. Medical office units will range in size from about 1,000 to 7,000 square feet. q