UTICA — Mohawk Valley Health System (MVHS) already has a $300 million grant for its downtown hospital project, and now it has the additional financing it needs as well. MVHS on Sept. 27 announced it has secured a loan to help fund its estimated $480 million project to build a new 373-bed, 672,000-square-foot health-care campus […]
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UTICA — Mohawk Valley Health System (MVHS) already has a $300 million grant for its downtown hospital project, and now it has the additional financing it needs as well.
MVHS on Sept. 27 announced it has secured a loan to help fund its estimated $480 million project to build a new 373-bed, 672,000-square-foot health-care campus in downtown Utica.
MVHS is an affiliation of Faxton St. Luke’s Healthcare and St. Elizabeth Medical Center, both of Utica. The two organizations teamed up in March 2014.
New York State in 2017 committed to offering a $300 million grant for the effort but MVHS needed to raise the remaining $180 million itself through a combination of its own capital, outside financing, and fundraising efforts.
The loan is financed through London, England–based Barclays, a multinational investment bank and financial-services company. MVHS didn’t disclose the amount of the loan.
“We are extremely pleased to finalize this important part of the project,” Scott Perra, president and CEO of MVHS, said in a release. “Securing this financing not only gives us the financial security to complete this transformational project in downtown Utica, but it satisfies one of the CON [certificate of need] contingencies which is vital to moving the project forward.”
Impact of new hospital
The new downtown Utica hospital will be taking “what are now very scarce but very robust health-care resources” and bringing them together into one system and a brand new facility, Perra says in an interview at the CNYBJ Syracuse office on Sept. 25.
The project will be designed for health-care “efficiency” from a patient, staff, and medical-staff perspective.
“We think it’s going to be a platform that allows us to then grow the entire service portfolio of what we offer in that region,” says Perra.
He noted that Masonic Medical Research Laboratory of Utica, which Perra described as a “world-renowned” cardiac-research facility, wants to have a satellite laboratory located in the new downtown Utica facility “because they know all the service is going to be located in one building.”
Perra also contends that a new downtown hospital will help the organization retain staff and recruit additional employees.
“Who wouldn’t want to work in a brand-new facility designed around the patient and designed around the staff. We think it’s going to help in all sorts of different ways from that perspective,” Perra contends.
Meeting a requirement
Closing on the financing satisfies one of the contingencies that the New York State Department of Health (NYSDOH) placed on its April 2018 approval of MVHS’s certificate of need for the hospital. The contingencies for approval from the NYSDOH Public Health and Health Planning Council are “common for a project of this magnitude,” MVHS said.
MVHS recently signed the phase I grants contract with NYSDOH which allows MVHS to begin utilizing a portion of the $300 million state grant. With the contract, MVHS can begin submitting reimbursement requests for expenses related to the new hospital that have already been incurred.
MVHS has already spent nearly $8 million on the project in areas such as building design and consultant fees, per its news release.
#NoHospitalDowntown
The group calling itself “#NoHospitalDowntown” is opposed to the downtown Utica location for the hospital project.
On its website, www.nohospitaldowntown.com, the group includes a section with at least 30 reasons why it doesn’t like the downtown area for the hospital project.
Jim Brock and Brett Truett are the group’s co-founders.
