For city residents, having health problems often means spending a lot of time on subways or in taxi cabs going from place to place for tests, procedures and to see various specialists.
But that may be about to change for many, with a new crop of medical office buildings under development in the area. Designed to increase efficiencies and meet the demands of this country’s more cost-conscious health-care system, the projects are increasingly putting the multitude of doctors, specialists and technicians patients need to see under one roof.
Take the case of a 140,000-square-foot building that Maimonides Medical Center broke ground on last week in Borough Park, Brooklyn. The $100 million facility will enable patients to visit a wide range of interconnected health-care providers in the same building. The Gensler Architects design includes special teaming areas intended to improve communication between doctors, nurses and staff.
“This design is a different way of thinking about and providing care,” said Eric Carmichael, a principal of Frauenshuh HealthCare Real Estate Solutions, the Minneapolis-based company selected by Maimonides to develop the property.
Hospitals throughout the country are coming up with new approaches to medical-office design in response to cost controls and regulatory changes. Under pressure to reduce the time patients spend in hospitals, they’re moving to make outpatient treatment more efficient for doctors and hassle-free for patients.
The wave of new medical-office developments is also attracting investment and generating outsize returns. According to the National Association of Real Estate Investment Trusts, health-care REIT shares produced total returns (including dividends) of 35.5% last year.
Currently, more than 3.4 million square feet of medical office space costing $1.8 billion is under development in the New York area, according to health-care real-estate data firm Revista. New development in this region as well as the rest of the East Coast, has been increasing, according to Elisa Freeman, a Revista principal,
Because New York City doesn’t have much raw land, construction projects often replace old hospital buildings. Emergency rooms are becoming urgent-care centers; other outdated properties are making room for outpatient surgery, Ms. Freeman said. For example, Mount Sinai Queens, in Astoria, demolished a historic medical building in 2013 to begin construction of a $125 million expansion that will offer primary and specialty outpatient service.
Under a strategic partnership between Frauenshuh and Health Care REIT Inc., Frauenshuh will develop and manage the property while Health Care REIT will own it. The companies plan to hold the seven-story building on a long-term basis.
Maimonides will occupy the facility as a tenant and house its current staff of physicians there. Mr. Stanzione explained that by renting, the hospital frees up capital to invest in features like improved imaging technology and advanced operating rooms.
Frauenshuh worked with Gensler Architects to design a modern medical building. To acquaint the Maimonides staff with more modernized and innovative office space, Frauenshuh organized a trip to Boston to survey Massachusetts General Hospital, which in 2010 opened what it calls “the ambulatory practice of the future.”
Such innovations reflect an overall shift in focus toward outpatient health care. “Health-care organizations are being held accountable for keeping the population healthy,” explained Mr. Carmichael. “That means the incentives are changing.”
Hospitals also are improving efficiency with an eye toward attracting patients and competing with other facilities. “More people are shopping for health care,” said Mr. Carmichael, “and we can provide them with a cost-effective setting.”