Making Healthcare Facility Renovation Or Update Moves With Little Disruption

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The need for high-functioning healthcare facilities is as clear as ever.

But what happens when a procedural suite needs to be upgraded? Or a major piece of medical equipment needs to be replaced to provide new treatment options to patients?

Traditionally, healthcare facility renovations or updates to large equipment can put essential treatment areas out of commission. However, Light Detection and Ranging (LiDAR) technology, a new form of Building Information Modeling (BIM) that uses lasered beams of light to measure distance, can be used during a project’s exploratory phase to help. LiDAR provides an understanding of the space inside walls and ceilings and under floors before demolition, greatly reducing the amount of time it takes to prepare for and realize improvements.

Utilizing this technology during non-critical hours of operation, a project team can create a 3-D scan of existing conditions, including sections and elevations, and 3-D views of a designated workspace—all without impacting a hospital’s daily activities. Sometimes discoveries made during this process prompt improvements to plans or allow the project team to avoid issues that may not have been realized until after demolishing a space.

Columbia recently partnered with a longtime healthcare client to use LiDAR to provide 3-D existing conditions scans for several CT rooms, one of which contained one of the only units in the region for bariatric patients. The goal was to replace the CT machines on a fast timeline and avoid unforeseen issues that could add to the project schedule and budget.

A limited number of team members visited the hospital during off-hours and scanned all relevant areas. The scans were uploaded and shared with the project partners, avoiding the need to bring a large group through the facility—a critical feature especially during the COVID-19 pandemic, when it’s essential to limit the number of personnel visiting a facility. Furthermore, utilizing the shared scans online helped establish early and effective collaboration among the design, construction, hospital leadership, and equipment vendor teams, with everyone relying on the same set of factual information.

For this particular project, the LiDAR scan improved and streamlined the process in several ways. For example, during a review of the existing conditions scan during a virtual meeting, a team member noticed an existing nurse call button located on one of the CT room walls that had been missed earlier. This detail required bringing in an additional subcontractor to change the positioning of the electrical system, and recognizing this issue before work got underway meant that the team could properly price and schedule the project.

Because we had scanned areas both below the floor and above the ceiling, the project team could also examine the placement of the existing equipment support beams. Knowing whether these were positioned in parallel or perpendicular fashion ensured the new CT units could be properly fitted without any last-minute headaches. The equipment support vendor was also engaged much earlier in the project, ensuring an accurate budget and proper scheduling.

The information gained using LiDAR technology can enable project teams to confidently design and prepare the layout of the structural support for the installation of new hospital equipment; identify the best placement of equipment with regards to access and end-user maneuverability; highlight and prepare for all utility maintenance access needed during construction; and more accurately time procurement of new equipment and feel secure that it will fit the space requirements.

Healthcare is a constantly evolving arena, and LiDAR technology can help address the challenges associated with necessary equipment replacement and space remodels, making it a welcome tool for the industry.

 

Source: healthcare design

New Hospital Coming To Venice, Florida In 2021

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Sarasota Memorial Hospital broke ground on its new hospital in April 2019, with its campus in Venice at Laurel and Pinebrook roads.

Its opening will be here in no time: SMH-Venice should be completed in fall 2021.

“It is going to bring services to that part of our community that is in great need,” SMH CEO David Verinder said. “We are looking forward to, quite frankly, many many years of that growing and continuing to serve in South County.”

The new hospital will offer a full array of medical and surgical care, including:

• Cardiology Unit/Catheterization Lab
•  Critical Care/Intensive Care Unit
• Emergency Care
• Endoscopy & other procedural areas
• Gastroenterology
• General/Vasular Surgery
• Labor & Delivery/Post-Partum Unit
• Laboratory/Diagnostic Testing
• Nephrology
• Neurology/Neurosurgery
• Oncology
• Orthopedics
• Pulmonology
• Imaging/Radiology
• Urology and more

The Venice hospital costs about $255 million to build. With furniture, equipment, the energy center and other campus infrastructure, the total cost will be about $437 million. The new hospital will be hurricane ready and has undergone some design changes in order to be better prepared for treating COVID patients, as well as other infectious diseases.

“The ICU is designed with negative pressure rooms so that we can better manage the pandemic if needed,” said Kim Savage, SMH’s public relations manager.

A negative pressure room, also called an isolation room, is meant for infection control. It allows air to flow into the isolation room but not escape from the infected patient’s room.

“Most hospitals had to quickly convert existing patient rooms into negative pressure environments or dedicate entire critical care units to safely isolate COVID-19 patients from other hospitalized patients,” SMH-Venice President Sharon Roush said. “Given the ongoing nature of this pandemic, we felt it important to be prepared for a resurgence of this or any other highly infectious airborne disease in the future.”

In addition to this, SMH added a negative-pressure ventilation system to convert all or a portion of their ICU/critical care units to a pandemic unit if needed. The new hospital will also greatly increase bed capacity.

“It will immediately add more than 100 beds, and we already are planning for expansion and that will allow it to double,” Savage said.

The initial development covers 48 acres on the eastern side of the parcel, but Savage says as the community grows, so will SMH-Venice. It has the capacity for 300 private patient suites, 16 surgical suites and a 50-bed ER. The expansion also will bring Sarasota Memorial’s extensive physician base further south and help build the medical staff for a future hospital in North Port.

The current plans for the Venice location includes:

• A 365,000-square-foot, 5-story hospital, with 110 private patient suites and 28-bed emergency center and 8 surgical suites
• A 2-story, 60,000-square-foot medical office building
•  Related support structures and service area
•  An adjacent 400-space parking garage and surface parking lots

“Construction on the new campus is full speed ahead,” Verinder says “COVID hasn’t slowed them down. We are very excited about the new Venice hospital coming online. It is going full speed right now. It’s beautiful even as it sitting in construction.”

He says they are in the process of hiring step and will be doing that throughout this coming year.

“We are excited to bring Sarasota Memorial’s high-quality care to the rapidly growing south Sarasota County community,” Roush said “Opening the new hospital in Venice will enhance care to the entire region, while also creating and sustaining jobs and livelihoods for hundreds of people and area businesses.”

Source: WTSP-TV News

Health System Financial Strength Fortifies Medical Office Acquisitions

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Health systems are on track to buy $1 billion of their leased medical office buildings in 2020 between closed and announced transactions – a trend we’ve coined as “reverse monetization.”

Despite the pandemic-related operating losses sustained by hospitals in 2020, health system liquidity remains high due to CARES Act funding and abundant access to capital. In fact, 2020 will be the third year in the past five during which MOB buybacks will exceed $1 billion, representing nearly 10% of all MOB trades. Buybacks typically occur when hospitals take advantage of purchase options embedded in leases or exercise contractual rights of first refusal. However, certain buybacks are happening today with no contractual rights.

The popularity of MOB buybacks and ownership is fueled, in part, by the cash savings opportunity they create. During the pandemic, health systems are highly focused on reducing cash expense. MOB buybacks can eliminate rent payments and help cash occupancy costs. Health systems may also be able to avoid property taxes for qualifying properties – sometimes saving $3-4 per square foot. Even in the face of record high pricing for MOBs in 2020, health systems have been willing to pay top dollar – matching the most competitive real estate investors – in recognition of the significant bottom line advantage presented by buybacks.

Where does the money come from to pay for buybacks? Hospitals’ cash reserves were fortified by the CARES Act, which bridged the initial loss of patient volumes and revenue. Today, most providers report that they are back to 90-95% of pre-COVID volumes, if not more, thanks to the reinstatement of elective procedures. Though operating cash flow has been significantly impaired in 2020, days cash on hand was less affected due to other sources of liquidity and the strong performance of investment portfolios for the not-for-profit health systems.

Municipal bond issuance accelerated in 2020, increasing by 25%. Not-for-profit issuers enjoyed record low interest rates, which created cash interest savings for refunding bonds as well as new issuance. Thanks to nominal rates consistent with the direct cost of borrowing, many health systems have found structured finance products appealing to finance real estate, including credit tenant lease financing and synthetic leases.

The headiest days of monetization date to 2016, when a record $1.4 billion of MOB sales by health systems occurred. Cash generated by sales of outpatient buildings, whether on or off campus, was used to reinforce liquidity, provide access to capital for high growth systems, transfer capital responsibility for buildings to a third party and manage regulatory compliance with physician tenants.

Today, healthcare providers own 65% of MOB inventory nationally, down from 75% ten years ago, driven by the advent of new off campus outpatient clinics. Investor demand for medical office is at an all-time high, accelerated by the defensive qualities of the asset class and its proven durable performance. Investors can’t get enough MOB and now find themselves vying for investment alongside the tenants. Health systems face a happy decision – whether to buy or lease – with capital markets supporting them well, whichever choice they make.

You can more about extracting capital from healthcare real estate in JLL: A 360 View of Healthcare Real Estate Monetization. Plus, view Jll’s 2020 Healthcare Real Estate Outlook

Recent 2020 activity

  • Closed – Investment Sale – Midwest Medical Office Portfolio, 439,000 s.f. – Indiana, Illinois & Missouri
  • Closed – Investment Sale & Debt Placement – Greenpark II – 80,098 s.f. – Houston, TX
  • Closed – Investment Sale – M.D. Medical Tower – 68,285 s.f. – Midwest City, OK
  • Closed – Investment Sale – Lovelace Medical Center – 69,539 s.f. – Albuquerque, NM
  • Closed – Debt Placement – Peachtree Orthopedics – 60,578 s.f. – Cummings, GA
  • Closed – Debt Placement – San Juan Medical Center – 42,970 s.f. – San Juan Capistrano, CA
  • Closed – Debt Placement – Milwaukee Nobis – 20,383 s.f. – Milwaukee, WI

 

Source: HREI