$75m no gap private hospital groundbreaking
Adeney Private Hospital, Kew
- A new no gap1 private hospital breaks ground in Kew (Melbourne, VIC)
- Doctor-Medibank JV operator; 20 year lease; Developed by Centuria; Owned by CPP
- Four operating theatres, an endoscopy theatre, 30 beds, radiology and an infusion (chemo) clinic
- Four storey healthcare building provides c.4,700sqm GLA2; anticipated to open mid-2024.
Construction of Adeney Private Hospital, which will be operated by a doctor-led joint venture with Medibank, is underway with developer Centuria Capital Group (ASX:CNI or “Centuria”) breaking ground on the $75 million, four storey building today.
The 4,696 sqm1 no gap private hospital, located on the corner of Adeney Avenue and Cotham Road in the east Melbourne suburb of Kew, will provide four operating theatres, an endoscopy theatre, a procedure room, 30 beds, radiology services and a chemotherapy infusion clinic, as well as a two level subterranean car park providing 80 spaces.
Centuria Prime Partnerships (CPP), a joint venture between Centuria and an investment vehicle sponsored by Morgan Stanley Real Estate Investing, is developing the property as a fund-through project and will retain ownership at build completion. The hospital will be operated by a joint venture between a group of 42 highly specialised medical professionals and Medibank through its Amplar Health business. The operator has committed to a 20 year lease.
Andrew Hemming, Centuria Healthcare Managing Director, commented, “We are proud to be part of this original development that sets a new benchmark in Australian healthcare, aligning the interest of patients and operators and creating more cost effective and care oriented outcomes. Centuria has worked closely with the operator to design a fit-for-purpose property that caters to modern healthcare procedures including specifically curated operating theatres and recovery spaces to maximise operational efficiency.”
The new hospital replaces a decommissioned 1970s hospital on the same 209 Cotham Road site, which was demolished in May 2022. The services to be provided by Adeney Private Hospital will support the Kew demographic and surrounding neighbourhoods.
The facility proposes to provide orthopaedics services, ear, nose and throat (ENT), vascular, plastics, general surgery, urology, gastroenterology, anaesthetics, oncology and radiology.
Professor Michael Grigg AM, respected vascular surgeon, former President of the Royal Australasian College of Surgeons and Adeney Private Hospital Board Director said, “The community is calling for increased options in healthcare delivery, with many welcoming a short hospital stay with increased at home support.
“This new facility is a significant personal investment by specialist doctors and by Medibank in the Australian Healthcare System. The joint venture is committed to delivering new short stay models of care minimising out-of-pocket costs for the patient, where clinically appropriate, across numerous modalities,” Prof Grigg added.
Medibank Group Executive and CEO of Amplar Health, Dr Andrew Wilson, echoed Professor Grigg’s comments, “The hospital will expand our no gap program, providing eligible customers with a choice in how their treatment is delivered, minimising unnecessary time in hospital and reducing out-of-pocket costs.”
Recent findings from a KPMG report, commissioned by Medibank, found that short stay models of care reduced the length of stay for hip and knee replacements by 50%, broad adoption of the short stay program across the health system could save 217,000 bed days in 2030 and 78% of surveyed participants were favourable toward the short stay model of care3. “We have long said we are supporters of innovation in health delivery – Adeney Private Hospital is a prime example of our commitment to support the sustainability of the Australian healthcare system.”
Construction of Adeney Private Hospital will proceed throughout a 21 month period with completion expected in mid-2024.
As at 30 June 2022, Centuria Capital Group manages $1.7 billion of healthcare real estate across Australia and New Zealand, a 35.3% increase year on year.
Victorian-based construction company, Hansen Yuncken, is the appointed building contractor. Hansen Yuncken was established more than 100 years ago and has vast experience in delivering healthcare facilities throughout Australia, with over $15 billion worth of healthcare projects delivered in the last decade alone.
1. No gap for all funders, although negotiations yet to be complete
2. Size reflects the building’s Gross Lettable Area (GLA).
Centuria Capital Group secures a $70.6 million industrial logistics facility in North Rocks, NSW, on behalf of US private investment firm, Starwood Capital’s, Last Mile Logistics Partnership (LMLP).
Centuria Capital Group has successfully exchanged conditional contracts to divest two adjoining industrial facilities located at 114 and 120 Old Pittwater Road, Brookvale NSW, which is anticipated to deliver a forecast 13.8% IRR to the assets’ closed-ended fund investors.