Health Care Construction Spending in Arkansas Is Climbing

Spending on health care-related construction projects in Arkansas nearly doubled in 2015 compared with the previous year.

One of the top projects in 2015 was Baptist Health of Little Rock’s 111-bed hospital under construction in Conway, which is expected to be open in September.

Health care-related projects under construction as of November had a valuation of $312 million compared with $160.6 million at the same time the previous year, according to Arkansas Business’ list of the largest commercial projects that were under construction at the time.

That $312 million figure didn’t include several health care-related projects that have since started construction. Arkansas Children’s Hospital of Little Rock is in the early stages of building a hospital in Springdale, which is projected to open in January 2018. That has a construction value of $167 million.

Other hospitals around Arkansas are in various stages of completing renovation projects, including overhauling emergency departments and adding patient towers.

Across the country, the value of health care-related projects rose 4 percent to almost $40 billion in 2015, according to the Associated Builders & Contractors Inc. of Washington, D.C.

Most of the jump in 2015 was tied to private health care spending, which was up nearly 8.6 percent to $31 billion compared with the previous year. Public health care spending fell 9.2 percent to $8.52 billion in 2015.

“So what we are seeing in health care is a real shift, at least in terms of investments from the public sector to the private sector,” said Anirban Basu, the chief economist of the Associated Builders & Contractors.

The passage of the Affordable Care Act and the economic recovery have helped millions of people obtain health insurance, he said, and that has increased demand for primary care services. “That has resulted in a considerable amount of private investment that has taken different forms,” Basu said.

The number of outpatient centers in suburban settings has risen, he said. And total spending could be higher because some projects, such as doctor’s offices or pharmacies in retail locations, could be classified as something else and not health care, Basu said.

Arkansas Business has looked at some of the health care-related construction projects in the state. Here’s a sampling of various projects:

Arkansas Children’s Northwest

Springdale

Cost: $167 Million

Architect: Polk Stanley Wilcox Architects of Little Rock and FKP Architects of Houston

Contractor: Nabholz Construction Corp. of Conway

Projected Completion: January 2018

Arkansas Children’s Hospital of Little Rock is building a 233,613-SF hospital in Springdale. “We have an aggressive timeline in order to open in January 2018, and we were excited to begin site prep recently,” Trisha Montague, senior vice president of regional services and administrator of Arkansas Children’s Northwest, said in an email to Arkansas Business. The hospital will feature 24 inpatient beds, an emergency department with five operating rooms and a helipad with refueling station.

Arkansas Children’s Hospital also has several construction projects in Little Rock. A Center for Safe & Healthy Children has a budget of $8.8 million and is expected to open in August. This project includes space for University of Arkansas for Medical Sciences’ programs for child maltreatment, family treatment and child psychology. “This center will, for the first time, unite all services under one roof for Arkansas children who have experienced physical or sexual abuse, making treatment more accessible for patients and families,” Dan McFadden, a spokesman for ACH, said in an email to Arkansas Business. The hospital also is renovating its pharmacy. The budget for that project is $5.2 million. The project will consolidate the pharmacy operations on the hospital’s second floor. The first phase of the project is complete, and the second phase will start this summer.

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St. Bernards Medical Center

Jonesboro

Cost: $130 Million

Architect: HKS Inc. of Dallas

Contractor: Nabholz Construction Corp. of Conway

Projected Completion: 2019

St. Bernards Medical Center of Jonesboro announced in December that it was starting a four-phase construction project. The project includes building a 245,000-SF, five-story surgical and intensive care tower and renovating the emergency department. The first phase of the project will be a cancer center that brings all components of the hospital’s cancer service line into a single facility on its main campus. The work is expected to be completed in October. All the projects are expected to be completed by 2019.

Baptist Health Medical Center-Conway

Conway

Cost: $80 Million

Architect: GSR Andrade Architects Inc. of Dallas

Contractor: CDI Contractors LLC of Little Rock

Projected Completion: September 2016

Construction began on Baptist Health Medical Center-Conway in the summer of 2014. The 264,000-SF, 111-bed hospital will be on the west side of Interstate 40 in Conway. The cost of building and furnishing the hospital will be $170 million. Baptist Health collaborated with about 30 doctors in Conway to design and develop the hospital. It will employ about 500 health care workers and offer services such as labor and delivery and physical therapy along with emergency services.

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Washington Regional Women’s Health Center Expansion

Fayetteville

Cost: $46 Million

Architect: HKS Inc. of Dallas

Contractor: Robins & Morton of Plano, Texas

Projected Completion: Fall 2016

In February 2015, construction began on the expansion of Washington Regional Women’s Health Center. The main feature of the project is a 130,000-SF five-story patient tower, which will connect to the existing women’s center at Washington Regional Medical Center in Fayetteville, according to an email from Gina Maddox, a spokeswoman with Washington Regional Medical System.

The tower will have 100 additional patient rooms, additional operating room space and the hospital’s second helipad. A 350-space parking garage will also be built as part of the project. The expansion will allow Washington Regional Medical Center to deliver up to 3,500 babies annually and provide care for infants born as early as 26 weeks, Maddox said in the email. In 2015, Washington Regional delivered 1,245 babies.

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UAMS Regional Program West

Fort Smith

Cost: $10.5 Million

Architects: Witsell Evans Rasco of Little Rock and HDR of Dallas

Contractor: Kinco Constructors of Little Rock

Projected Completion: January 2017

On March 3, UAMS West, the University of Arkansas for Medical Sciences’ regional center in Fort Smith, broke ground on the UAMS Family Medical Center in Fort Smith. The 30,000-SF center will provide space for the growth and development of the patient care programs and medical education, according to an email from UAMS spokeswoman Leslie Taylor. “The new building will provide UAMS West patients, residents and staff with a state-of-the-art outpatient clinic that includes 48 examination rooms, X-ray facilities, a laboratory, procedure areas, patient counseling rooms and a children’s immunization area,” Taylor said in the email.

Metropolitan Emergency Medical Services

Little Rock

Cost: $9 Million

Architect: Cromwell Architects Engineers of Little Rock

Contractor: Nabholz Construction Corp. of Conway

Projected Completion: November 2016

Metropolitan Emergency Medical Services is building a two-story, 37,000-SF headquarters. MEMS Executive Director Jon Swanson said the headquarters will feature an EF4-rated shelter for the communications department, “so we can continue to function through a storm.” MEMS provides emergency ambulance services to Little Rock and its surrounding cities. The headquarters also will have 9,200 SF for training and 4,000 SF of classroom and instruction space. MEMS is an agency of the city of Little Rock, but it is self-funded through the fees it charges.

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White River Medical Center Emergency Department Renovation

Batesville

Cost: $5 million

Architect: Cromwell Architects Engineers of Little Rock

Contractor: Clark Contractors LLC of Little Rock

Projected Completion: October 2016

White River Medical Center in Batesville is expanding its emergency room, which was opened in 1995. Gary Bebow, the administrator of the hospital, told Arkansas Business last week that the number of patients using the emergency room has grown and space needed for technology has increased in the two decades since the ER opened. “So we’re basically doubling the size of the emergency room from what it was before,” Bebow said. The finished space will have about 8,000 SF and 27 rooms. The current ER has 21 rooms.

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Value of Construction Put in Place – Seasonally Adjusted Annual Rate

(Millions of dollars. Details may not add to totals due to rounding.)

			2014 v.	2015
	2014	2015	Net	%
Total Health Care	$38,410	$39,962	$1,552	4.0%
Private Health Care	$28,556	$31,010	$2,454	8.6%
Public Health Care	$9,854	$8,952	-$902	-9.2%

Source: U.S. Census Bureau; Associated Builders and Contractors