The UC Board of Regents recently approved a $147 million lease to construct a medical facility across from the Santa Monica-UCLA Medical Center and Orthopaedic Hospital.
The lease for the project, which has been under consideration for more than six years, was signed in November, but the Regents did not grant approval until December.
Plans for the facility have officially been under way since then. Construction will hopefully begin in March, said developer Randy Miller. He added that, until then, his private construction company is currently working to finalize loans separate from the university’s budget.
The project is expected to be completed by late 2011.
The new facility will host outpatient surgery, cancer treatment and general medical office visits, as well as provide additional space to support UCLA’s mission of medical education, said Ted Braun, spokesman for UCLA Health Sciences.
Dr. Denise Sur, director of the UCLA Family Medicine Residency Program, echoed Braun’s anticipation for the expanded teaching opportunities the new facility will provide, as she supervises education, training and clinical experiences for family medicine,
“(The teaching program) models are where many of our students and residents will end up in practice,” she said.
While many services are simply being expanded, additions to the hospital’s services like outpatient chemotherapy and oncology will provide medical students with new opportunities for the application of learning in a community hospital environment rather than within a classroom, Sur added.
Santa Monica Hospital was originally purchased by UCLA in 1995 to accommodate its expanding medical school, said Posie Carpenter, chief administrative officer of the Santa Monica-UCLA Medical Center and Orthopaedic Hospital.
By opting to sign a private deal, the university is evading an immediate price tag, as Miller’s company is entirely fiscally responsible for design and construction until completion.
When the building is completed, UCLA will pay about $5 million per year for 30 years, Carpenter said.
“On top of that, the university has the right to buy the building from us well before they end the lease, meaning they will probably never pay that amount,” Miller said.
He added that while $147 million is steeper than a typical cost estimate for simply building and owning a facility, unforeseen expenditure that often occurs with contracting construction means such estimates can be quite conservative.
The construction will be relatively fast because it is overseen by only one company, and timeliness is important in making sure the building is ready by the time the Santa Monica Hospital renovation project currently underway comes to a close next year, Carpenter said.
Essentially, by eliminating the need for separate architects and contractors and shying away from the responsibility of immediate ownership, UCLA’s tactics are both timely and financially savvy, Carpenter said.
The funding will come from operating revenues generated by UCLA Health System,
Miller, who is deeply frustrated by the UC budget crisis, said the UCLA Health System strategically handles constraints well.
The UC Berkeley alumnus said by the time payments on the lease begin, the building will more than pay for itself and the extra revenue can be reinvested in the hospital.
Miller said he trusts the project will be awarded a gold LEED certificate for its environmentally conscious design.
One particularly notable concept is the underground garage that will use a mechanical car lift to store 250 cars in a very minimal amount of space, saving energy in numerous ways, Carpenter said. The garage will be the first of its kind on the West Coast.