Top Tulsa health systems competing for real estate

Journal Record, The (Oklahoma City), Feb 20, 2008 by Heather Caliendo

Health care construction is booming here and the companies behind the building are basing decisions in large part on what their competitors are up to.

When St. John Health System builds its new facility in Broken Arrow it will be the seventh new health care facility in the past two years. St. John took the opportunity after Saint Francis Health System moved its full-service facility to 91st Street and U.S. 169 in Tulsa, the former site of the company's heart hospital.

The St. Francis Broken Arrow facility at 300 S. Elm is now an urgent care clinic.

Keith Sterling, director of communications for the city of Broken Arrow, said while St. Francis' south location is nearby, it is not the same as having a full-service facility in the city.

"The city had become accustomed to having Saint Francis here on Elm," he said. "The thought of not having the hospital in their own city is a concern to citizens. They want to have a facility near their home in the city's limit that they feel could call their own."

Mike Prescott, co-owner of Broken Arrow Medical Facility, contracted with St. John to build the new hospital in Broken Arrow. The 150,000-square-foot facility will cost about $80 million to build.

Many groups expressed interest in coming to the city, and in the end city officials decided to let St. John build on a 68-acre spot near the Broken Arrow Expressway.

Prescott said they are also planning to build a medical office building next to the hospital, which could bring their Broken Arrow project to $100 million. Construction will start in six weeks, weather permitting.

While the new hospital will help bring health care to the city, Sterling said they are anticipating new economic developments as well.

"We think the hospital will help economic growth in the city," he said. "We've talked about the possibilities of continuing to see the growth over time."

Health care-based economic growth is something the city of Owasso has come to know. In 2006 St. John and Hillcrest Healthcare System both opened brand-new facilities. Prescott's company was also behind the construction of St. John Owasso.

The two hospitals brought $100 million in construction to Owasso and promise an annual combined payroll of $22 million.

Earl Denning, president and CEO of Hillcrest and the Ardent Health Services Oklahoma division, said most hospitals plan construction projects three to five years in advance.

He estimated that since Ardent Health Services acquired all Hillcrest services, they have invested almost $500 million.

Although hospitals are being built outside the Tulsa metro, urban hospitals are expanding.

Saint Francis opened a new $72.6 million Children's Hospital in January, and Hillcrest's $64 million cardiac-care center is half completed.

Denning said Hillcrest wants to provide health care in individual neighborhoods, including outpatient care and urgent care.

Hillcrest's Utica Park Clinic will celebrate its grand opening today in Sand Springs.

Denning said the health care industry is extremely competitive.

"How often do you drive down the street and on one corner you see a Walgreen's and on the other is a drugstore," he said. "I kind of compare it to the fast-food industry; health care is going down the same path.

"We're based on the needs of patients," he said. "And based on what the competition is doing."