The pipeline of health care projects is beginning to slow as hospitals experience dramatically reduced revenues, industry officials said Tuesday.

Hospitals have seen significant drops in revenue-producing elective procedures, leading many health care groups to put building projects on hold, an architect and construction manager who work in health care said.

“Several of our clients have had to just put capital projects on hold because they’re faced with extreme downturns in revenue,” said Larry Parrett, a principal at NBBJ‘s Portland office.

Health care groups also face higher costs related to retrofitting existing facilities and providing personal protective equipment, he added. “We have seen quite a few our projects put on hold, particularly if they’re in the design phase,” Parrett said.

The comments came during a Builder Breakfast event held virtually Tuesday by the Daily Journal of Commerce. The discussion panel also included Trent Rehfeldt, health care market executive for Mortenson’s Portland office, and Doug Nelson, PeaceHealth’s system vice president for planning and development.

Some health care projects are still moving forward. Parrett said NBBJ continues to respond to requests for proposals for new patient towers, ambulatory care centers and medical office buildings. Urban “micro-clinics” are increasingly popular, as are in-office health care clinics at major corporate campuses such as Amazon and Microsoft.

Mortenson Construction is pricing subcontractors for a wellness center at Reed’s Crossing, the South Hillsboro mega-development. Mortenson plans to break ground in December, with delivery scheduled 15 months later, in early 2022, Rehfeldt said.

“This project, because of our delivery system, never paused, never stopped, so we’re excited to deliver the Reed’s Crossing project for Hillsboro,” Rehfeldt said.

The wellness center will have two full stories and 108,000 square feet. The project combines a full medical clinic with a fitness facility, including an aquatic center, locker rooms, a childcare center and other amenities.

Mortenson is serving as developer and design-builder with Ankrom Moisan Architecture.

Broadly, the pandemic has led to a number of design changes. PeaceHealth, like other health care groups, is reworking patient rooms, Nelson said.

“We want to transition to single-patient rooms,” he said. “PeaceHealth has a lot of shared patient rooms. We understand that’s not where health care is headed at all.”

Anne Talcott, health care industry group leader at Schwabe, Williamson & Wyatt, served as moderator for Tuesday’s event.

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As the coronavirus pandemic slows development and construction in Portland, health care projects are moving to the front of the permitting line.

In recent days, the Bureau of Development Services has issued permits for tents at Legacy‘s Emanuel and Good Samaritan hospitals, Providence Portland Medical Center and Providence Gateway. Oregon Health & Science University received a permit to modify an existing auditorium building for patient intake.

“Our Facility Permits Program is working around the clock and working closely with hospitals and health facilities to make sure we can get their permits in the pipeline and approved as quickly as possible,” BDS spokesman Ken Ray said.

In some cases, health care building permits are being issued the same day they come in.

“According to our Facilities Department, BDS has approved all of our permits,” Brian Terrett, a spokesman for Legacy Health, stated in an email. “They also indicated that minor projects that were reviewed by the Facility Permit Program at BDS are working well, and Legacy has benefited from that process.”

BDS’ assigns staffers to work with large institutions, including hospitals, which have ongoing permitting needs for frequent renovations, building maintenance and updates such as fire alarm installations.

While health care projects are advancing, many other developments are not. BDS remains . Permitting is limited by nearly all BDS staffers working remotely using a computer network with limited capacity. As a result, BDS has limited new permitting intakes to projects designated as critical “Tier 1” or “Tier 2.”

Tier 1 includes hospitals and clinics fighting COVID-19, and ongoing infrastructure projects such as the Portland International Airport terminal upgrades and city water plant construction.

Tier 2 includes projects that have building permits in hand and are already under construction.

Meanwhile, other projects are waiting. New commercial construction permits are not being accepted. BDS has exceptions for affordable housing – those are included in tiers 3 and 4.

As other work grinds to a halt, designers and contractors that have bet heavily on health care stand to benefit. Among them is NBBJ, a Seattle-based architecture firm that opened a Portland office last fall.

NBBJ is the designer of two projects for OHSU – the Elks Children’s Eye Clinic now under construction and a 14-story hospital tower not yet under way. (OHSU did not respond to requests for comment). NBBJ is also designing Legacy Emanuel Medical Center’s renovation and expansion in North Portland, and a project for St. Charles Medical Center in Bend.

“We’re grateful to have that level of investment in health care,” said Carl Tully, an NBBJ principal who works in Seattle and Portland.

Health care projects are proceeding at a normal pace, Tully said.

“We have projects in all phases of progress right now,” he said. “The encouraging thing is we have not had any slowdown, whether it’s being able to have inspections on site, having permits approved, or having permits going through the intake process pretty flawlessly.”

Other firms are looking to help. ZGF Architects‘ health care practice in Portland scrambled to design a modular unit to provide relief for hospitals burdened by a surge of COVID-19 patients. ZGF was approached by TCM Corp., Western Partitions Inc. and Cherry City Electric to provide programming design.

The modular units would be prefabricated regionally and delivered by trucks to hospitals in need of overflow space. They would be placed on a concrete pad, parking lot or other paved area.

“The concept here is these modules would be primarily to off-load lower-acuity patients out of hospitals,” said Richard Shiga, a ZGF principal who is spearheading the design work.

Regulatory agencies have been helpful, Shiga said.

“One of the most interesting things about this process has been the conversations with the state and the city,” he said. “It’s been amazing. Both the state and city have gone out of their way to make it as quick and easy and efficient as possible.”

The units’ size is based on what can be put on a truck and shipped quickly, Shiga said. The companies are in the process of fabricating a prototype. Their goal is to be able to fabricate, ship and set up the modular units within 72 hours.

Shiga said the units are flexible enough to accommodate different purposes if the need arises. Ideally, they may not be needed at all, as Oregon hospitals have so far had adequate capacity to handle coronavirus patients.

“This is the kind of project where if this never needs to happen,” Shiga said, “we’re all for it.”

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A Dallas-based developer’s plans for a five-building redevelopment of property in the South Waterfront District have a long way to go to gain approval, the Portland Design Commission indicated on Thursday.

The development would sit on four blocks near the Willamette River. Portland Bureau of Development Services staffers raised questions regarding access to the Willamette River, traffic impacts and the layout of a greenway through the area.

The project’s first review hearing before the Design Commission was Thursday. Commissioners were nonplussed by Alamo Manhattan‘s proposal, saying they were unsure how to even begin evaluating what one commissioner described as an incomplete land-use application for a massive redevelopment.

Alamo Manhattan proposes to build approximately 1,232 residential units, 20,000 square feet of retail space and 965 parking spots. The design would locate two high-rise buildings closest to the river, with three mid-rise buildings on the two western blocks, in contrast with city guidelines that call for building heights to step down to the river. The buildings closest to the river would rise to 244 feet, 9 inches, just below the 250-foot maximum height. The interior block buildings would be approximately 72 to 73 feet tall.

“This is very unusual that we’re reviewing five massive buildings and a greenway,” Commissioner Zari Santner said. “How come the bureau accepts an application that is so insufficiently complete?”

“The applicant can deem it complete,” BDS planner Staci Monroe replied. “There is nothing in the code that prohibits it.”

Monroe agreed that it was not typical to review several buildings and related infrastructure at once.

“It’s an insane amount of work to put this into one land-use case,” she said.

Santner suggested the developer’s plans were not close to meeting guidelines.

“There’s nothing that stops us from asking the applicant to keep coming back until we get to something that’s approvable,” she said.

Alamo Manhattan President Matt Segrest offered no indication that the developer would break up the land-use application into smaller parts.

“I recognize this is a huge chore here,” he said. “It is. There’s no way around that. We want to get this approved as soon as we can as well.”

The staff report did not recommend approval – a routine stance in the early stages of a land-use application. However, the staff report details at least 29 distinct guidelines not yet met by the proposal. Furthermore, the city’s environmental services and transportation bureaus, as well as the BDS site development section, stated they were not able to support the application.

The design team includes WDG Architecture, HLR Architects, landscape architect Linda Tycher and Associates and engineering firm Otak.

The property is slightly north of The Old Spaghetti Factory, and bounded by Southwest Bond Avenue, Southwest Lane Street, Southwest Lowell Street and the river.

Two design advice hearings for the project took place in February and August. The project team is scheduled to return before the Design Commission on Feb. 6, 2020.

Also on Thursday:

OHSU expansion wins approval

The Portland Design Commission unanimously approved plans for Oregon Health & Science University’s 14-story hospital expansion on Marquam Hill.

Commissioners praised the proposal presented by the design team of NBBJ, based in Seattle, and Mayer/Reed, which handled the outdoor plaza.

“The response that we’re looking at today is significantly stronger than when this building (design) came into the room,” Design Commission Chairwoman Julie Livingston said at Thursday’s hearing.

The building will be located slightly west of the Elks Children’s Eye Clinic, which was also designed by NBBJ.

The plaza and outdoor spaces were a focus of the Design Commission’s attention throughout the review process. The designers responded to earlier criticism that the plaza’s pathways weren’t well integrated and lacked separation between pedestrians and cars. The final design expanded outdoor seating, added street trees and also created a landscape buffer between the sidewalk and street.

“Your collective feedback has greatly improved the hospital design as well as the public plaza,” said José Sama, a principal with NBBJ, which recently opened a Portland office.

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Seattle-based architecture firm NBBJ recently opened a Portland office to capitalize on its relationships with local health care institutions.

The firm has opened for business in the Board of Trade Building at 310 S.W. Fourth Ave., with capacity for up to 25 employees.

NBBJ is designing Oregon Health & Science University‘s 14-story expansion on Marquam Hill, the OHSU Elks Children’s Eye Clinic and the Legacy Emanuel Medical Center‘s renovation and expansion in North Portland. NBBJ also designed a new wing of the St. Charles Medical Center in Bend.

“We wanted to better serve our clients,” said Jose Sama, a partner in the new Portland office.

NBBJ has worked with Skanska on several projects, and is looking to deepen its local connections with that contractor, Sama said.

“We have a good relationship with them, and we’re looking at identifying opportunities with other contractors and developers,” he said.

NBBJ searched for a small office of 3,000 to 5,000 square feet on the west side of the Willamette River. The firm looked at more than a dozen properties in downtown and the Pearl District.

NBBJ signed a lease in early September, and opened the office after installation of approximately $100,000 in information technology infrastructure. The space was renovated recently.

“It was basically move-in ready,” NBBJ principal Larry Parrett said.

NBBJ was founded in 1943 in Seattle by four partners. Boeing was an early client, and the firm performed public housing and health care work in postwar years.

“Culturally, Portland is very similar to Seattle,” Parrett said. “We feel like we fit right in.”

The city offers other advantages as well, he added.

“There’s a lot of design and staff talent in Portland,” he said.

Despite talk among presidential contenders of reducing health care spending, the sector’s long-term prospects remain promising, according to Parrett.

“We’ve been doing this a long time, and health care – just like other markets – goes in waves,” he said. “There’s always a lot of work in health care. It’s one of the most recession-proof markets there is.”

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The thought of constructing a tower core without rebar would cause many builders to scoff.

But the project team behind a 58-story tower under construction in Seattle is working to prove that there may be a better, faster way to build tall.

Seattle-based engineering firm Magnusson Klemencic Associates (MKA) has pioneered a new type of high-rise building core that utilizes a concrete-filled composite plate shear wall system called SpeedCore. The system was used for the first time on Rainier Square, an 850-foot-tall mixed-use tower being built by general contractor Lease Crutcher Lewis.

The building was designed by NBBJ for Seattle-based developer Wright Runstad & Company.

Because the concept was utilized for the first time on such a high-profile project, there are a lot of eyes on the work being done.

“I would say the goal of Rainier Square was to score the touchdown,” said Brian Morgen, a principal with MKA. “Given the infancy of it and the newness of it, the city (of Seattle) assigned a very robust peer panel to review everything we were doing.”

The SpeedCore concept was actually borrowed from methodology used around the world to construct nuclear power stations, Morgen said.

“The loading is entirely different with blast and projectile,” he said. “You have thick walls for out-of-plane loading, while for tall buildings we’re using the same concept in a completely different manner. Extrapolating it to Rainier Square was the first real world application when it comes to high rises.”

So how does it work?

Because concrete in a building core is normally poured days or even weeks before structural steel is erected on the same level, the leading core method leads to completion of the building core long before the rest of the building catches up.

By contrast, erection of a SpeedCore structure begins with prefabricated panels consisting of two structural steel plates held in place with cross-connecting tie rods. After erection, the panels are filled with concrete, which is poured from the bottom of the panel. The resulting sandwich provides strength and stability along with significant on-site time savings.

It does away with the need for curing time entirely by eliminating the need for a leading core. Also, it eliminates the need for formwork, installation of rebar, embedded plates, sleeves and block-outs.

“In SpeedCore you could do two floors in one week,” Morgen said. “Now, what you’re doing is trading prefab time offsite to achieve that; that does have lead time associated with it.”

And now the involved firms know the concept works as intended.

The Rainier Square project topped out after just 10 months, achieving a construction rate of roughly 1.35 floors per week. The system has shorted the timeline of the project, which is slated for completion in March 2020, from 40 months to 31 months.

MKA is currently designing five new California high-rise buildings using SpeedCore concepts, including the 19-story 200 Park Avenue tower project in San Jose.

In order to realize time savings using the system, builders need to plan ahead. The pre-construction phase of a SpeedCore project is lengthened by the need for precision in drawings sent to the fabricator, as well as the time needed to ensure accurate fabrication of the steel panels. In addition, the long lead time allows for less flexibility later.

“With a concrete core there is more flexibility for MEP penetrations coming through the core later on,” said Shannon Testa, Rainier Square project manager for Lease Crutcher Lewis. “You can start steel and MEP coordination and MEP can even lag, because other than moving rebar around for the most part there aren’t any fly zones.”

With these steel panels, however, coordination of systems and trades must occur much earlier in the schedule.

Once that is done, however, the actual erection of the structure is far quicker than the traditional leading core method: up to 40 percent faster from start to topping out.

So far, the efficiencies gained through this process pencil out for a high-rise project like Rainier Square. According to MKA’s Morgen, the system is advantageous for buildings about 30 stories and higher. With further refinement, savings can be realized on smaller projects like 200 Park Avenue.

Lease Crutcher Lewis marketing manager Jordan Gevers said the nine-month time savings at Rainier Square was key in allowing the project to pencil out.

“All the numbers changed from red to black. It’s not only the up-front costs, but it’s the speed to market too. You’re spending less in the first place but earning money more quickly.”

Testa noted this would also depend on the cost of materials, as well as the anticipated building time period.

“When we priced it out it was a premium to use the steel core over concrete if you were just looking at direct costs,” she said. “When you figure in the schedule savings this became a much more cost-effective project,” she said. “You don’t pay for cranes, hoists, personnel and staffing costs; so all of those things more than offset the actual direct costs. But you won’t see that savings as much in a shorter building even though you have schedule savings.”

She said it is likely that as this building methodology becomes more common associated steel fabrication costs will fall. The concept is non-proprietary, and many steel fabricators will be able to produce a similar type of panel. The steel panels used on Rainier Square were fabricated in Portland by Supreme Steel.

“For commercial fabrication this is big plate steel, more commonly used in shipbuilding than in buildings,” Testa said. “There was, for sure, a learning curve in making these panels.”

As it becomes more commonplace, Testa added, that learning curve will become less steep.

“I think MKA’s design will get refined over time,” she said. “We were the pilot project for the use of this system in a high-rise. It was peer reviewed, but in feeling good about it, it also meant there were redundancies and overly conservative assumptions in some aspects. People will get more comfortable with it.”

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A proposal for Oregon Health & Science University‘s 14-story expansion appears to be close to earning the Portland Design Commission‘s approval, but first a number of concerns about outdoor spaces must be addressed.

Commissioners discussed the project for nearly three hours on Thursday. With a Bureau of Development Services staff report recommending denial pending improvements to address several unmet guidelines, commissioners opted to continue the hearing until Dec. 12. A vote will likely take place then.

The design team of NBBJ‘s Seattle office and Portland landscape architect Mayer/Reed unveiled new renderings of the massive hospital expansion atop Marquam Hill. The design consists of two towering glass-and-steel wings with a white spandrel glass frame over a podium clad with a warmer, reddish panel. The building on Southwest Campus Drive would have 526,297 square feet of interior space, with three levels of parking and three sky-bridges connecting to adjacent buildings.

The building would look over a garden cut through by an Americans with Disabilities Act-accessible path. The OHSU expansion project would be on the site of the former School of Dentistry building, which was demolished. Two design advice hearings took place previously.

Design commissioners’ comments focused on the garden and a pavilion that overlooks it.

“The problem with that overlook is it’s not connected to the inside,” Commissioner Zari Santner said. “It’s not connected to the outside.”

Commission Chairwoman Julie Livingston, picking up on written comments submitted by Commissioner Jessica Molinar, who was absent, said the garden lacks a gathering place.

“It’s all path, no place,” she said.

Carol Mayer-Reed, principal of Mayer/Reed, defended the design by saying the site is limited by a 10-foot grade change, neighboring buildings including the Elks Children’s Eye Clinic and substantial underground infrastructure that rules out tree plantings along the sidewalk.

“We want to do all of the same things you do; we just have a very constrained site,” she told commissioners.

NBBJ partner Jose Sama said the path has a destination: the building’s front door.

Design commissioners told Mayer-Reed and project landscape architect Tim Strand to try again.

“The space has got to be activated, and I’m sure you can get there,” Livingston said.

In some ways, the designers are wrestling with a decision made 100 years ago. OHSU moved to Marquam Hill in 1919 to land donated by a railroad that couldn’t make the site work for rail. Designers have since puzzled over how to move people from points below to the hill.

That question has become more acute as OHSU has become one of the state’s largest employers. Now, Metro and TriMet plan to build the Southwest Corridor light-rail project below the site. A connector from Barbur Boulevard is envisioned that would complement the aerial tram that was completed in the South Waterfront in 2006.

Overall, design commissioners praised the expansion building, although they challenged details such as the placement of white fins on the exterior. Commissioners indicated OHSU will have an approvable project if designers can fix access issues with the overlook and garden.

“In general, the building is a very handsome building,” Santner said. “It’s cohesive. We’re just asking you to do the impossible so we can really truly say you’re meeting design guidelines, because we have a responsibility to do so.”

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A proposed 14-story hospital tower at Oregon Health & Science University‘s Marquam Hill campus went before the Portland Design Commission for a second design advice hearing Thursday. Commissioners were happy with alterations the design team made to the façade, but still had concerns about the local impact.

The new facility would contain adult acute-care services on two floors and women’s and children’s programs on four floors, including a relocation of the neonatal intensive care unit and mother-baby unit. Sky-bridges will connect the tower to the main hospital and the Kohler Pavilion.

The tower design by Seattle-based architectural firm NBBJ was previously criticized for an imposing concrete design that was too cold. Commissioners also said an overhang above a drop-off area would block too much sunlight from those entering the building or waiting outside.

The new design incorporates more glass to give the building a brighter, more reflective look, and at the base the building features a wood-like finish to feel more natural and warm. The overhang has also been pushed back, allowing more sunlight to hit the sidewalk and the incorporation of landscaping at the ground level.

“The way this opens up is actually quite attractive,” commission vice chairman Samuel Rodriguez said. “It does a great service to the pedestrian experience.”

Parking was still a point of concern for commissioners. Three floors of above-grade parking and eight floors for clinical programs are planned, which commissioners said will create too much traffic on nearby Southwest Terwilliger Boulevard. Chairwoman Julie Livingston, who said she generally likes the modifications made, said parking will have to split across the site so one area doesn’t become too congested.

“The modifications you’ve made are slight, but also successful,” she said. “You are moving in the right direction on almost every issue, but that doesn’t mean those issues are resolved.”

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It’s no secret that one of the best ways to save money on a construction project is by finding efficiencies to shorten the schedule. The team building the new Oregon Elks Children’s Eye Clinic on Oregon Health & Science University‘s Marquam Hill campus did just that.

Skanska USA Building is serving as general contractor for the project to erect a new five-story, 60,000-square-foot structure designed by Seattle-based NBBJ.

Carr Construction ironworkers placed the final steel beam atop the sixth-level mechanical penthouse last month, marking completion of the building’s structural framework. Use of a new steel moment frame system designed by Mission Viejo, California-based SidePlate Systems and fabricated by L&M, an Oregon based division of SteelFab, has accelerated construction significantly.

“I think schedule was the biggest driver,” said Ron Lai, the project manager for OHSU. “When we went through the A3 process of really discussing the concept in depth, the advantages in schedule really came out and were very, very apparent. Once we started I think we saved close to four months of time, we estimated, and that’s something that nobody thought we would have.”

SidePlate Systems uses bolted connections to secure the structural steel components. But the manner in which oversized beams and columns fit together neatly eliminates the need for brace frames and shear walls, and cuts the amount of required welding to a minimum.

Extra room is built into the connections to allow the steel moment frame to shift in the event of a seismic event. The bolted connections also make possible the replacement of damaged components in a way that welded connections do not.

“You purchase a licensing fee and they help you with the design,” explained Nik Heagy, a senior project manager with Skanska USA Building. “That allows you to have longer, bigger spans. The steel is quite large for the size of building that it is, so we have pretty wide spans in the building and pretty limited columns.”

It’s not only the lack of welding that saves time, but also the elimination of the need to schedule full-penetration welds, which require time-consuming preheating of steel components during cold weather. That even benefits patients at the existing Casey Eye Institute adjacent to the project site. Normally, welding activities would need to be carefully shielded from view with darkened, opaque screens. But because of the extensive use of bolted connections, that kind of precaution is largely not required here.

“It was a little bit of a risk because it’s fairly new technology,” Lai said. “But there was a lot of confidence from (structural engineering firm) MKA and also from Carr and Skanska about this system. So we had a lot of confidence going in. Needless to say it has turned out very well.”

The new technology is starting to gain in popularity. Fortis Construction used SidePlate components in the Providence Newberg medical office building project now under construction, and Skanska is using it on the massive Terminal E expansion at Portland International Airport.

Crews broke ground on the eye clinic project in November 2018. Substantial completion is expected by mid-July 2020. Then roughly three months will be spent transferring new and existing programs and staff into the new building, which in addition to the children’s eye clinic will hold a new macular degeneration center, an ophthalmic genetics center and a clinical trials center.

Structural steel is complete and fireproofed up through the fifth floor. The sixth-level mechanical penthouse is expected to be enclosed soon, Heagy said. Then the dry-in process will proceed on other floors.

“We’ll go west (side) to north to east and then on the south it’s all curtain wall,” he said.

The steel connections to a fourth-level sky-bridge connecting the new building with the existing Casey Eye Institute, are also complete. On the inside, metal framing is completed through two floors, with mechanical, electrical and plumbing rough-in proceeding.

“We have had so many discussions with people around campus commenting on how it seemed like the building just sprouted up overnight,” Lai said. “And it literally has because of this technology.”

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General contractor Skanska USA Building and design firm NBBJ recently celebrated the opening of a $66 million expansion of the St. Charles Medical Center in Bend.

The new three-story patient tower at St. Charles has 24 new intensive care unit beds and 28 inpatient beds along with shell space for future expansion of hospital operations.

This is the third major expansion of the facility in the past 12 years and the largest since the addition of the St. Charles Cancer Center. The new patient tower is located north of the hospital’s existing ICU and significantly impacts the overall look and feel of the campus.

This project also included construction of a parking lot with 300 spaces and a second water line to build redundancy.

“This project was so important for the future of health care in Central Oregon,” Joe Sluka, president and CEO of St. Charles Health System, stated in a hospital press release. “This plan ensures we can continue to meet our patients’ needs well into the next century.”

The new patient tower opened on Sunday and is a direct response to growing capacity issues at the hospital. The St. Charles Health System Board of Directors voted to advance the project in July 2016.

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Oregon Health & Science University this week celebrated the topping out of a new five-story building at its Marquam Hill campus.

The Elks Children’s Eye Clinic is a 64,000-square-foot structure that will be connected directly to the existing Casey Eye Institute via a sky-bridge. The project was designed by Seattle-based NBBJ and is being built by general contractor Skanska USA Building.

On Monday, union ironworkers with Carr Construction placed the final structural steel beam atop the roof level as a crowd watched from the street below.

The clinic is being built on the site of the former OHSU School of Dentistry, which was demolished last year following a two-year process that required shoring up an abutting hillside. A 14-story hospital expansion project is also planned at the site.

The new clinic will feature an 11,500-square-foot children’s eye clinic and space dedicated to macular degeneration, ophthalmic genetics and clinical trials.

Outside, there will be a multi-sensory garden with seating, pathways and a café courtyard. Completion of the project is expected by July 2020.

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