HDP | Healthcare Development Partners

Rush Presbyterian - St. Luke's Medical Center

Situation

This project was a new 135,000 square foot on-campus medical office building. Healthcare Development Partners was quantitatively selected as the full-service developer and provided all development activities – including financing, construction management, and leasing. Rush understood the importance of a strong marketing and leasing program. HDP has successfully constructed and leased over 3,000,000 square feet of physician office space. This experience was crucial for Rush and they needed a proven partner that could meet project deliverable. This was an off balance sheet financed transaction and Rush-Presbyterian-St. Luke's Medical Center entered into a master lease for the building. HDP handled all subleases between Rush and the physician tenants. Project challenges were surrounded by the fact that we were facing neighborhood opposition to the construction. We needed to rezone two parcels of our 6 acres from residential to hospital and the neighborhood was intent on blocking our rezoning efforts.

Solution

We held countless neighborhood meetings to address concerns but opposition continued. After nine months, we were successful in obtaining a zoning variance and we appeased the neighbors with several minor modifications that did not affect building aesthetics or operational efficiency. Additional challenges were that many of the physicians that practiced at the hospital were renting space in Class C office space throughout the community. We needed to be able to attract those physicians to the new facility with a solid leasing program. Notable tenants in this facility include: a 7,500 square foot orthopedic clinic, a 5,000 square foot MRI unit, a 5,000 square foot pain clinic, a 7,000 square foot oncology group, a 7,000 square foot primary care clinic, a 15,000 square foot home health center, and numerous independent community physicians. This development added a new presence to an old hospital and signified that Rush was committed to providing needed specialty services in the community. The development rejuvenated the hospital and the increase in primary care and sub specialists allowed the hospital to increase its inpatient volume by 10% and operating margin by 25% within one year. HDP completed the project two months ahead of schedule.

We have successfully developed more than $1.5 billion in healthcare real estate for a variety of clients.

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