San Ramon-based property developer firm Meridian, which focuses on medical industry real estate, announced this month that it recently closed escrow to acquire an 188,000-square-foot medical complex in Arizona.
The Tri-Valley company plans to invest in property improvements and renovations at the newly acquired El Dorado Medical Plaza, an 11.55-acre parcel with a three-story combined "Class B" medical office building, surgery center and hospital in Tucson.
"El Dorado Medical Plaza was attractive to us for a variety of reasons," Sheila Schmidt-Turkington, Meridian's vice president of real estate development, said in a statement last week.
"In addition to being in a location that we were eager to gain a footprint in, existing relationships with Tucson Medical Center and the behavioral health provider made the property very appealing," she said. "Also, the building was at a 'fork in the road,' as major systems had to be refurbished or replaced, and the anchor tenant was deciding whether to stay or go. It was a classic value-add opportunity."
The acquisition price was not revealed. Meridian did note that the property was purchased in partnership with an unnamed "large institutional investor."
The El Dorado Medical Plaza will be the second building acquired and renovated by Meridian in Arizona, according to CEO John Pollock.
"This facility is unique in that it includes both a medical office building and a surgery center, plus it has inpatient hospital floors," Schmidt-Turkington added. "The property is currently 82% leased to three tenants, Tucson Medical Center (TMC), Southern Arizona's regional nonprofit hospital, a 36-bed inpatient behavioral health hospital, and a prominent surgery center."
Planned renovations include better usage of the mostly unused surface parking lot on the east side of the building, creating dedicated entryways and updated internal corridors within the buildings for tenants, improved signage to guide patients, separating the suites of different tenants and activating a secondary main entry on the east side of the building, officials said.
"This project gives Meridian the opportunity to do what Meridian does best, solve real estate challenges for our healthcare clients," Schmidt-Turkington said. "Meridian will have touched every major building system when this renovation is complete -- giving our tenants a highly functioning building, so they can focus on what they do best -- providing excellent patient care to the Tucson community."
Meridian officials expect the building renovations to begin this month and be finished by the end of the year.
"The El Dorado health campus is an aged campus and is at a point and time when it requires significant capital investment to improve and modernize its infrastructure and aesthetics," said Richard Prevallet, vice president of facilities and construction for TMC HealthCare. "The planned renovations to this campus will make a significant difference for our staff and patients and we are thrilled to work side by side with Meridian."
Founded in 1999, the San Ramon company now has approximately 750,000 square feet of medical real estate in development or redevelopment across the western United States.