City’s hospitals spend billions amid construction surge

Health care construction spending to increase to $8B through 2018

New York /
Dec.December 02, 2016 10:00 AM

The city’s health care sector is seeing a surge in construction spending as hospitals spend billions updating outdated facilities and adding preventative health services, a new study finds.

Hospitals in the five boroughs spent more than $6 billion on construction between 2013 and 2015, and are expected to dole out another $8.2 billion through 2018, according to a new study and survey from the New York Building Congress.

Industry consolidation is one of the factors pushing the spending increase, as big hospital systems acquire other organizations including doctors’ offices and smaller health-care facilities, the Wall Street Journal reported.

Smaller facilities are also under development in the city, as primary and outpatient-care services expand both on and off big hospital campuses.

Construction costs in the sector are among the most expensive. It can cost as much as $1,700 per square foot to build the highly specialized facilities, the Building Congress’ report found.

NewYork-Presbyterian, which is finishing up interior work for a new 750,000-square-foot women and children’s hospital on the Upper East Side, spent $500 million to $600 million between 2014 and 2015.

“A lot of hospitals in New York have been around for decades, and they really receive a lot of wear and tear, and we have to work to keep them fresh,” said Joseph Ienuso, vice president for real estate and facilities at the hospital.

Health care construction spending will add roughly 2 million square feet of hospital space through 2020, the report found.

The Building Congress recommended updating zoning in Manhattan’s East Side health corridor and developing zoning to encourage investment in the outer boroughs as ways to help the city’s institutions remain competitive.

Richard Anderson is scheduled to step down as head of the Building Congress next year, with Brooklyn Chamber of Commerce head Carlo Scissura tapped to take over. [WSJ]Rich Bockmann


Related Articles

arrow_forward_ios
Housing, Collapse
Housing starts collapse under inflation, high rates
Housing starts collapse under inflation, high rates
Arlington Village at 3100-3124 Atlantic Avenue in East New York, Brooklyn (Google Maps, Getty)
Developing in downtrodden areas gets dicey
Developing in downtrodden areas gets dicey
Durst Organization's Douglas Durst, Jamestown's Michael Phillips and One Times Square (Durst Organization, Jamestown, Getty, Bernt Rostad from Oslo, Norway edited by Yarl/CC BY 2.0/via Wikimedia Commons)
Durst sues Jamestown over Times Square scaffolding
Durst sues Jamestown over Times Square scaffolding
A photo illustration of the Broadway Spanish Baptist Church (Google Maps, Getty Images)
Harlem church seeks state approval for redevelopment plans
Harlem church seeks state approval for redevelopment plans
A photo illustration of the national housing shortage (iStock)
Strapped supply turned housing shortages national before pandemic frenzy
Strapped supply turned housing shortages national before pandemic frenzy
Assembly OSM CEO Andrew Staniforth with an illustration of the building design (AOSM)
Modular startup raises $38M, says it’s “the opposite of Katerra”
Modular startup raises $38M, says it’s “the opposite of Katerra”
A photo illustration of 243 Fourth Avenue in Park Slope (Google Maps, iStock)
Brooklyn DA charges scaffolding company in 2019 incident
Brooklyn DA charges scaffolding company in 2019 incident
From left: Alice Technologies founder and CEO René Morkos; Join CEO Andrew Zukoski (LinkedIn/René Morkos, LinkedIn/ Andrew Zukoski, iStock)
Construction tech startups Alice, Join score new commitments
Construction tech startups Alice, Join score new commitments
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...