A Neighbor Takes a Long-Term Look at Construction Costs

This interesting analysis of alternative plans and their costs was contributed by a neighbor:

CHRMC Expansion: Two Cost-effective Alternatives

Chicago's Children's Memorial Hospital (CCMH) is building an entirely new 1.25 million sq. ft. hospital on a new site to replace their current facility (see here and here). Their latest cost estimate is $1 billion, taking 4 years to complete. Compare this to the cost of Seattle's Children’s Hospital and Regional Medical Center (CHRMC) expansion proposal:

Plan A: CHRMC proposes a 1.5 million sq. ft. on-site expansion overlaying their current buildings, taking 15-20 years. They have not released the cost - our Citizens Advisory Committee (CAC) should ask for this estimate - but common sense and a professional construction cost estimator tell us that the cost will be at least double that of construction on a clean site. Based on the Chicago cost, this leads to an estimate of (1.5/1.25) x $1 billion x 2 = $2.4 billion.

Furthermore, CHRMC tells us that 20 years from now, the current buildings that remain will have to be replaced, having outlived their useful lives. How much more will it cost to replace these 900,000 sq. ft. on-site? Perhaps $1 billion, probably more, requiring another 10 years of on-site construction. Thus we estimate the total cost of 2.4 million sq. ft. of new/renovated space for CHRMC to be $2.4 + $1 billion = $3.4 billion, accompanied by up to 30 years of on-site construction impact and disruption on the patients, their families, the medical staff, and the community. (Cost estimate based on Chicago numbers; no estimate released by CHRMC.)

Plan B (buiid on a new site): By contrast, CHRMC does say that the cost to move from their present 900,000 sq. ft. site and build a brand new 2.4 million sq. ft. hospital (including the additional 1.5 million sq. ft. they ask for) would be $2-2.5 billion, taking only 5 years. And this cost would be reduced further by the proceeds of the sale of the existing campus. So for a savings of $1 billion or more, CHRMC could build a brand-new 2.4 million sq. ft. facility instead of the proposed 1.5 million sq. ft. on-site addition followed by renovation of their current buildings. This would avoid up to 30 years of disruption to CHRMC itself and the community.

Clearly Plan B would be win-win for everyone.

Another low-impact, low-cost alternative:

Plan C: leave the current 900,000 sq. ft campus untouched and build a second 1.5 million sq. ft campus on a new site, with the advantage of geographical diversity and/or locating next to a partner hospital or CHRMC's own new research facility. Based on the Chicago numbers, this would cost only $1.2 billion, again with no disruption to anyone. CHRMC objects, citing the inefficiency of operating a "smaller satellite hospital", but surely 1.5 million sq. ft. does not qualify as a small satellite. Chicago's CCMH is happy to be getting a brand new 1.25 million sq. ft. hospital in total.