Two NexCore Group Healthcare Developments Named 2020 HREI Insights Awards™ Finalists
Two healthcare facilities developed by NexCore Group, a national healthcare real estate developer, have been honored as Finalists in Healthcare Real Estate Insights™ (HREI) magazine’s annual, national awards program. NexCore, which is headquartered in Denver, developed the facilities in Tucson and Millard, Neb., a suburb of Omaha.
Todd Varney, NexCore’s Chief Development Officer, remarked, “It’s a great honor that NexCore’s projects – Tucson Surgery Center and CHI Health Clinic Millard – have been recognized as Finalists in the prestigious HREI Insights awards program.”
Jarrod Daddis, President of NexCore, adds: “NexCore is pleased to be acknowledged by the HREI Awards again this year. These Finalists embody NexCore’s mission of developing quality healthcare facilities across the country that meet the most pressing patient needs while being efficient and cost-effective.”
HREI is the first and only national magazine entirely devoted to covering healthcare real estate (HRE) development, financing and investment, and the HREI Insights Awards™ are the first and only national awards dedicated to recognizing excellence in the areas of HRE development and executive leadership.
In the seven years since the highly competitive HREI Insights Awards began, NexCore projects have been named Finalists 18 times (including this year’s finalists) and Winners six times, including four times for development projects, once for Lifetime Achievement (Tim Oliver, Director Strategic Planning & Development, won in 2016) and once for HRE Executive of the Year (Greg Venn, CEO, won in 2019).
The NexCore-developed projects that were named 2020 Finalists are:
Tucson Surgery Center, Tucson, Arizona
A Finalist in the “Best New Development, Medical Office Buildings (MOBs) and Other Outpatient Facilities, Less than 25,000 square feet” Category, Tucson Surgery Center is a one-story, 20,000 square foot replacement ambulatory surgery center (ASC) located on the PIMA Medical Campus in Tucson, a growing market with an increased need for outpatient procedures. The project involved a replacement of the original, 25,000 square foot ASC, which opened in 2001, performs over 8,000 cases annually and is operated by a joint venture (JV) between Community Health Systems (CHS) physicians and Northwest Medical Center. The JV knew that while successful, the existing facility lacked efficiency and limited growth.
NexCore was engaged to optimize the new facility on a predetermined replacement site on the PIMA Medical Campus, a site that posed several challenges. NexCore partnered with Davis Stokes Collaborative to develop creative design solutions to find the optimal fit on the tight site without losing key operational spaces. To obtain licensure prior to the required opening date, the team had to meet a tight project schedule with the Certificate of Occupancy (CO) anticipated in November 2020. The timeline did not allow for any delays, and with construction peaking in the midst of the COVID pandemic, progressive evaluation and management was taken to ensure there were no supply delays. NexCore also developed a creative financial structure to create long-term ownership with a real estate investment trust (REIT).
NexCore was able to facilitate the tight fit on the PIMA Medical Campus while maintaining all key revenue drivers for the surgery center, preserving the six operating rooms that were in the original ASC, and reducing the square footage by 20 percent. The reduction by 5,000 square feet in the new facility means annual operating costs are expected to decrease, improving the JV’s economic health as it pertains to real estate overhead. The collaboration between NexCore, the JV, and construction team resulted in the on-time delivery of the new Tucson Surgery Center with substantial completion in October and CO in November. This provides the JV with reasonable time to obtain licensure before the expiration of their current lease so they can avoid paying double rent.
“The strategy NexCore deployed with the Tucson Surgery Center exemplifies the creativity, ingenuity and teamwork we strive to bring to every healthcare project we undertake,” says Mr. Varney. “Producing such effective solutions for our clients and their patients, despite a wide variety of inherent challenges, is one of the most satisfying and rewarding components of what we do, and seeing the resulting facility thrive in ways that are relatively seamless to both the client and its patients makes all those challenges surmountable.”
CHI Health Clinic Millard, Omaha, Neb.
A Finalist in the “Best New Development, MOBs and Other Outpatient Facilities, 25,000 to 49,999 square feet” Category, CHI Health Clinic Millard is another example of an optimized replacement facility, and a continuation of Client CHI’s successful run of prototype designs it has developed with NexCore around the country.
CHI Health’s original Millard facility successfully served the community for many years, but no longer fit CHI Health’s needs as it could not physically accommodate the projected growth and the space configuration did not allow CHI Health’s operational model to function optimally. The existing site also had limited visibility.
NexCore set out to explore a variety of options and a site adjacent to the existing CHI Health MOB was selected. During the initial programming meeting, planned providers and services revealed a similar size building as the initial prototype NexCore had developed for CHI in Council Bluffs, Iowa. Within the same meeting, NexCore pulled up the plans from the successful CHI Council Bluffs clinic, situated the building on the site, and CHI Health approved the new plan on the spot. The prototype had initially been designed to include a pharmacy, but upon studying the market, the development team saw the pharmacy market was well saturated in the surrounding area but there was a need for a diabetic education center. The flexibility of the prototype allowed for an easy transition to fill the community need.
The resulting one-story, 38,700 square foot prototype proved to be doing its job by expediting the development process by shortening the design time, allowing a construction start within a month from the project kickoff. Learnings from the first Council Bluffs development were incorporated into the drawing, facilitating an incredibly smooth project delivery. Due to excellent planning, CHI Health Millard’s new facility was delivered early with almost all contingency funds unused, and a portion of the savings made it possible to repave the drive to the adjacent MOB for CHI Health. The state-of-the-art facility provides the opportunity to accommodate future growth and delivered operational efficiencies leading to an improved patient and provider experience.
“CHI Health Clinic Millard further solidifies the creative solutions NexCore realized in the Council Bluffs project — a wonderfully flexible model that is quickly and easily adapted to the specific market need and patient volumes in future projects,” Mr. Varney says. “The success of these efficient and effective prototypes is sure to be replicated in other communities, again solidifying NexCore’s core mission.”
About the 2020 HREI Insights Awards
The Winners of the HREI Insights Awards will be announced in December. For more information on the awards, please see HREInsights.com.