Today’s announcement that Oceans Healthcare, Capital Area Human Services, Ochsner Health, and the Louisiana Center for Eyes would occupy the vacant New Era Medical Office Complex in north Baton Rouge is part of a plan that has been in the works for the past two years, according to those involved with the project.
When announcing the public-private partnership in a news conference this morning, Mayor Sharon Weston Broome was flanked by a group that included Gov. John Bel Edwards, U.S. Rep. Cedric Richmond and Metro Councilmember Chauna Banks, along with representatives from New Era Holdings, CAHS, Oceans and the Louisiana Center for Eyes, all of whom took turns at the mic to discuss the significance of the investment.
“In this time of increased awareness of racial inequalities, it’s important that we not just address the pandemic, but all the inequity we see,” said Richmond, a Black Democrat from New Orleans. “It starts by fixing deserts, but it can’t end here. This has to be a catalyst to incentivize more businesses to invest here.”
The center has been empty since mid 2017, when boutique surgical specialty hospital Champions Medical Center closed. At the time, the facility was owned by NextHealth LLC, a for-profit Dallas company; however, earlier this year, another Texas-based company called New Era Holdings purchased the property for some $7.2 million.
New Era—which specializes in medical and mixed-use developments—has a portfolio that includes, among other projects in Texas and elsewhere in the U.S., two Louisiana assets: a behavioral hospital in Hammond, and an under-construction in-patient rehab hospital in Shreveport. The company was approached by the city-parish last fall about revitalizing the medical building.
“We were already familiar with the [Louisiana] market, and our interest in this facility was really because it’s a well-built building; it’s in good shape, it’s just closed,” says Michael Arvin, New Era’s executive vice president of strategy and development. “We saw an opportunity to do something with it, and asked ourselves, ‘What’s the highest and best use for what the community needs today?’ It would require redoing some things at the hospital, but that had been part of the plan.”
Together, Broome and New Era collaborated with the Metro Council to unanimously secure incentives to attract the providers to the facility.
Chief among them was Oceans, for whom the Metro Council in December approved a $1.4 million, performance-based grant to open a mental health facility in the building, which Oceans needed in order to make the agreement work financially. On its own, Oceans will create more than 85 new jobs at the complex, and it has entered into a 10-year lease for 35,000 square feet of space, where it will offer in-patient behavioral care and outpatient group therapy.
“It just made sense for us to expand our footprint in Baton Rouge, and a lot of it had to do with the mayor’s and [Banks’] interest in our company,” says Nick Guillory, COO at Oceans, which has existing operations on Florida Boulevard. “This will mean 40 more beds for geriatric services.”
Soon after the addition of Oceans, other providers followed suit. Ochsner Health COO Michael Hulefield says he and Broome had discussed partnering on the project at a Rotary luncheon in January, after which Ochsner agreed to sign an initial five-year lease on a 5,100-square-foot space in the building, which will be followed by multiple renewal options. Ochsner had also secured a $100,000 Community Development Block Grant through the mayor’s office, which it will use for the project.
Broome’s spokesperson, Mark Armstrong, says neither CAHS nor the Louisiana Center for Eyes secured a grant through the mayor’s office as part of the project.
New Era is currently working with CAHS on the internal buildout of its second-floor space, expecting the service provider to move in sometime next month. The other tenants will begin trickling in near the end of the year, with the facility anticipated to open to patients in the first quarter of 2021.
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