Oncologists Gain Independence With Adaptive Reuse Project

The conversion of a former office building into a new cancer center resulted from a disagreement between hospital officials and a group of St. Louis oncologists. The doctors and the officials had differing views on patient and physician needs within the cancer care environment, so the oncologists opened their own facility in a former Citicorp space.

The oncologist’s story dates back to 2002, when new cancer facilities were planned at several locations around St. Louis, but St. John’s Mercy Medical Center had no plans for such renovations or improvements. Doctors John Eckardt, Alfred Greco and Leonard White – all oncologists working at St. John’s – knew something had to be done to improve the facility’s cancer treatment or they faced losing patients.

"Our patients were having to wait a couple hours to get treatments and a couple hours to get blood work," White says. "If they needed a CAT scan it would be a week, and if they needed an MRI it would be two weeks. We just didn’t feel that was appropriate."

Despite the long patient waits, the hospital appeared to have no plans to improve the situation with renovations or new construction, so the doctors took action.

"We had become concerned that the hospital was not doing enough with respect to cancer care, and all of the other hospitals around us were putting up cancer centers," Says White. "We felt that we would have to hire our own person to (plan a cancer center), which we did."

Blueprints for renovations at St. John’s were created under the doctors’ guidance and submitted to hospital officials for approval. The plans initially got a warm response from administrators, but then negotiations cooled and hospital officials backed out of the plan, according to White. Soon after, the hospital revealed its own plans for a new cancer center.

"They were willing to put up a cancer center, but we weren’t going to have much input on how it was going to be run and we did not want to do it," White says.

With the belief that a cancer center planned by doctors would have a greater benefit for patients, the oncologists instead opted to look at other options and different locations.

"They said, ‘It’s our way or the highway,’ and I think they were a bit taken aback when we elected to not be a part of it," White says.

The doctors searched for a location to house a new cancer center, but none of the area’s medical facilities could accommodate their needs.

"We were looking to move outside of the hospital and the hospital office buildings," White says. "We looked at several other facilities and none of them were satisfactory."

In early 2003, the doctors saw inspiration in an unexpected location – a 135,000-square-foot office building that formerly housed Citicorp Mortgage. The building provided an ideal location close to a major thoroughfare, Highway 40, but more importantly the building was located within a mile of St. John’s and was in close proximity to two other St. Louis hospitals.

Eckardt, Greco and White formed AMSI Properties LLC and purchased the building with the intention of converting former office spaces into a cancer center and medical offices that could be leased by other doctors. By May 2003, the doctors and their 50 employees opened The Center for Cancer Care and Research. However, the group found that the skills they learned in medical school couldn’t help them manage the building as efficiently as they would have liked, and outside reinforcements were brought in to help facilitate the office building’s medical center conversion.

A New Development

Enter Earl E. Walker and Alvin D. Vitt, two well-known St. Louis businessmen. Walker, CEO of Carr Lane Manufacturing Co., an international supplier of tooling components, purchased a significant portion of the building, becoming its majority owner. Vitt, a commercial property developer, agreed to manage the building.

After the two got involved with the project, $14 million was secured for renovations that would allow the entire structure to be inhabited by medical offices.

"Alvin Vitt had plenty of experience with the banks to show them that we had the wherewithal to get it done," White says.

The building was constructed in the early 1980s with the sole intention of housing business offices, therefore it required specific modifications for it to be successfully converted into a medical facility.

Parking issues provided the biggest challenge for those involved with the renovations. The city of Town and Country, Mo., an exclusive suburb just west of St. Louis, requires that medical offices have eight parking spaces for every 1,000 square feet of space, double the amount of spaces needed for business offices.

"We had to develop a plan for additional parking and since there was no more land available, the only option we had was to build a one-level precast parking deck over the existing parking lot," Vitt says.

Figuring out a plan for additional parking and constructing it was tough enough, but Vitt also had to finesse city officials who were reluctant to allow the construction of a parking structure within their jurisdiction.

"Alvin really led the charge to get the city of Town and Country to approve the project," says John Komlos, vice president of sales at Arco Construction, the company hired to execute the renovations. "They typically wouldn’t want to see a parking garage, but Al made a great case that the building wasn’t going to be usable without a parking garage. He had to really sell the city on the concept, so we’re past that hurdle."

The building also had to be renovated to accommodate ADA standards, so to meet compliance issues and for the benefit of patients visiting the building, the facility’s entry was modified.

"It was built several years ago before the Americans With Disabilities Act, so we’re literally putting a new front on the building that includes an elevator to get patients from the parking level to the floor level of the building," Komlos says.

Additionally, the inside of the building was gutted and corridors were added to separate medical offices. A new roof, bathroom upgrades, plumbing and electrical upgrades and HVAC systems were also be added. Construction on the project is scheduled to be complete by January 2006.

"When it’s all over we should have a brand new building," Vitt says.

Medical Partners

Although the building’s bones aren’t brand new, the renovation saved the doctors that formed AMSI Properties – and other parties that invested in the building – a significant amount of time and money.

"There is significant financial savings for being able to adapt and reuse a building such as this, and I think it is going to work very well for them," says the project architect Rick Clawson, of ACI/Boland.

The new facility will also benefit tenants who will have the option of participating in a partnership deal that allows them partial building ownership.

"They will have a choice, they can sign the lease and be a tenant, and if they want, in addition to being a tenant they can be a partner in the ownership of the building," Vitt says.

Vitt says the program is attractive to medical professionals because doctors prefer to stay at one location, and even if the rent is a bit higher due to the renovations, tenants will benefit from investing in the building.

"Even though you have a higher rent, if a doctor can be an owner and see that he is getting some equity, and when all is said in done, he can see that the mortgage is getting paid off with some of the rent that he is paying, it makes it a bit more palatable."

With the exception of the cancer center, The St. Louis Orthopedic Institute is the building’s first tenant. The facility has also caught the attention of several other medical practitioners – including dermatologists, urologists and surgeons – without the use of promotions or advertising. As space is leased, ARCO Construction will tailor each office to suit tenant needs.

"So far the response has been tremendous," Vitt says. "A lot of these doctors have been under the control of either hospitals or insurance companies, and in many cases sold their practices. I think medicine is making a full cycle to the point where doctors will be able to practice medicine and be free of both the hospital and insurance company."

Clawson, who has been involved in the design of at least four other adaptive reuse medical facilities, believes that reuse projects will continue to be an attractive option for physicians who want to avoid the costs of building new or the aggravation of looking for property.

"It makes a lot economic sense for the doctors groups," Clawson says.