Centuria Healthcare has pre-committed a consortium comprising Medibank and 42 doctors to a $64 million short-stay surgery in Melbourne’s east.
The landlord will fund construction and retain ownership of the asset, set to replace the former Cotham Private Hospital at 209 Cotham Road, Kew.
The tenant will operate it for an initial 15 years.
The facility will provide no gap treatment to eligible private patients, offering services for orthopaedics, Ear, Nose and Throat, vascular, plastics, general surgery, urology, gastroenterology, anaesthetics, oncology and radiology.
With four operating theatres and a procedure room, the hospital will contain 30 beds, radiology, an infusion clinic and 90 basement car parks.
A new build
The landlord is expected to apply for the new project, this year.
“We are delighted to partner with the joint venture doctors and Medibank to develop and own the real estate delivering this new short-stay surgical facility,” Centuria Healthcare managing director Andrew Hemming said.
“This is a transformative project that can change the landscape of the healthcare sector and we are pleased to be the real estate partner”, according to the executive.
“The project is central to Centuria Healthcare’s strategy to partner with top-tier operators backed by secure lease covenants (story continues below).
“We are focused on providing modern healthcare real estate investments across Australia and currently have c$1 billion worth of these assets under management”.
Professor Michael Grigg, as spokesperson for the tenant, said “we are committed to delivering short-stay models of care where clinically appropriate, across many surgery types, with reduced or no gaps for eligible patients”.
Medibank Group executive Healthcare and Strategy, Dr Andrew Wilson, added it has called for greater affordability in the private health system for some time.
“Out of pocket costs are a big part of that,” according to the businessman.
“Our investment is aimed at supporting our doctor partners to deliver a short-stay model of care that is already widely available at scale in other health systems internationally”.
Healthscope operated a hospital on the 2245 sqm site for years.
In 2018, that provider sold the property to Hamton which obtained a permit for a residential redevelopment, while renting it to a medical occupier.
That builder later offloaded the site to Centuria for c$20m.
This pocket of Kew is about eight kilometres from the city.