PeaceHealth To Demolish Buildings At Hospital Site

PeaceHealth University District in Eugene buildings to be demolished.JPG

PeaceHealth is clearing away roughly 300,000 square feet of old medical buildings at the hospital system’s university district campus in Eugene, but it won’t say what it plans to do with the resulting roughly two acres of prime bare land. 

The four buildings, all vacant, date to 1941, 1951 and 1965, said PeaceHealth spokesman Jeremy Rush. As part of the 15-month project, the hospital’s dining area and lobby, which are in the buildings that will be left standing, will be refurbished, PeaceHealth said. Demolition will cost $5.5 million, and the renovations will cost $990,000, Rush said.

The work continues the evolution of the hospital, which for many decades was the cornerstone and main moneymaker of the PeaceHealth system.

But ever since PeaceHealth scrapped plans for a big expansion at the city center site nearly two decades ago and opted instead to build a massive new hospital – RiverBend on the outskirts of Springfield - the Eugene facility has taken a back seat and become a consistent money loser.

The demolition will create bare land in the heart of the east side of Eugene’s city center, a district that has boomed with redevelopment in recent years, much of it driven by expansion at the University of Oregon, which lies east of the university district hospital. The UO has constructed a string of new academic and other buildings. Residential developers have built student apartment towers. And a Portland developer has launched construction of a 16-acre apartment/commercial complex nearby along the Willamette River.

But PeaceHealth won’t say what its long-term plans are for the campus – or whether it has any. Once the demolition is carried out, Rush said the land will be “seeded and modestly landscaped.”

The hospital has 117 licensed beds. After the demolition, the facility will have six buildings left.

Two decades ago, PeaceHealth had grand plans for expanding the campus and keeping it as the system’s flagship. But PeaceHealth wanted up to six city blocks for a new tower and other new facilities, and the near impossibility of securing that much land in an already densely packed neighborhood prompted its executives to look elsewhere. They opted to build RiverBend on largely vacant land at an estimated cost of $367 million.

The buildings to be demolished at the hospital have been vacant since either 2014 or 2008.

PeaceHealth said that for years it has planned to remodel the campus lobby and remove the empty buildings. “We are committed across our networks to a long-range plan that will modernize and expand our facilities to further meet our patients’ evolving needs,” Todd Salnas, chief operating officer, PeaceHealth Oregon network, said in a statement.

The university district campus, including the hospital and the adjacent PeaceHealth Medical Group practice, has about 1,000 employees, Rush said.

The site houses a mixture of operations: an emergency department; the Johnson Unit secure inpatient behavioral health department; an inpatient medical unit; an inpatient rehabilitation unit for patients recovering from strokes or other injury; an intensive outpatient unit; and outpatient behavioral health, home health and hospice programs.

Vancouver, Wash.-based PeaceHealth has a network of hospitals across Oregon, Washington and Alaska. The chain is largely kept afloat financially by profits from RiverBend and PeaceHealth Saint Joseph Hospital in Bellingham, Washington. Many of the system’s other hospitals lose money or break even.

The university district campus has been a consistent money loser. In 2019, expenses of $120 million exceeded revenues by $22.8 million, according to filings with the Oregon Health Authority. Expenses included $3.4 million in charitable care and $10.7 million in bad debt run up by patients. By contrast, RiverBend, with its heavy focus on surgeries and specialty practices, reaped a profit of $76.6 million on revenues of $746 million.

You can reach Christian Wihtol at [email protected].






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