McLaren to build $450 million hospital adjacent to Michigan State

LANSING — McLaren Greater Lansing will consolidate operations at its two south Lansing facilities into one $450 million hospital on what was once farm land near Michigan State University, the hospital announced Monday.

“We’re only going to get one chance to do this," McLaren Greater Lansing President and CEO Tom Mee said, "and it’s a once-in-a-lifetime opportunity to be given the latitude to spend this kind of money and design something from the ground up.”

The new health care campus will be developed on land acquired from the MSU Foundation in the foundation's University Corporate Research Park between Collins Road and US 127 south of Forest Road.

Work on the project will begin in spring and should be completed by 2021. The new campus will be paid for through bonds, Mee said.

The move will solidify the hospital's relationship with MSU, Mee said. The new facilities will allow the school and the hospital to work more closely on research and educational programs, he said.

To have a "21st century place designed for 21st century medicine for our students to be able to learn, for our faculty to be able to provide clinical care, for our students to be able to engage in a different way, that’s really great," MSU President Lou Anna Simon said at formal announcement Monday afternoon at the University Club of MSU, "but the real value added in this partnership with the university is about knowledge and knowledge generation."

MSU will continue to work with hospitals across the state despite the enhanced partnership with McLaren, Simon said.

“It’s our philosophy to be deeply embedded in communities," she said.

The new facility will help bridge a gap between what’s done now in health care and how health professionals hope to treat patients in the future, said Norman Beauchamp, dean of MSU's College of Human Medicine.

"Our ability to participate in transforming health is what I’m really excited about," he said.

The new campus will also be a boon for recruiting efforts for both the university and McLaren, Mee said.

“Unless [prospective employees] have roots in this area, it’s difficult to recruit out of state," he said. "But when you take the lure of a brand new acute care hospital adjacent to a Big Ten university campus and the increased efforts with research, it becomes a magnet for individuals who may not have considered the Lansing region previously.”

McLaren Health Care CEO and President Philip Incarnati echoed Mee, saying the partnership with MSU will allow the hospital to compete nationally for employees.

Consolidating the hospital into one facility will also create efficiencies and improve communication for patients and staff members, he said.

"Employees can expect that this facility will make their job easier," he said. "It will create more of an incentive to be at work every day."

McLaren will conduct focus groups with patients, their family members and community members to get feedback on how to best design the new facility.

McLaren Health Care has mulled moving or rehabbing its Lansing campuses for more than a decade, Mee said. The hospital began discussing moving closer to MSU two and a half years ago, he said.

The new campus will have 240 beds, a cancer center and an ambulatory care center. McLaren expects to add about 80 employees when the campus opens and to fill about 75 present openings. McLaren Greater Lansing has close to 2,000 employees.

An estimated 2,500 one-year jobs will be created during the construction process.

The new facility will be nine stories tall and have 18 operating rooms, according to current plans.

David Washburn, executive director of the MSU Foundation, declined to say what, if anything, McLaren paid for the property.

Lansing Mayor Virg Bernero told the crowd at Monday's announcement that "Christmas has come early" for Lansing.

“This could have been a huge loss. To capture [McLaren] and keep them in the city is huge," he said, adding that the new hospital is an economic win for the city and a sign that Lansing's economy is strong and worth investing in.

McLaren Greater Lansing was previously known as the Ingham Regional Medical Center. The hospital’s governing board decided in 1997 to become a subsidiary of the Grand Blanc-based McLaren Health Care Corporation. At the time, the move was characterized as an effort to upgrade facilities and compete with Sparrow Health System.

The hospital, which was founded in 1913, changed its name in 2012 to reflect its new ownership.

McLaren’s current Lansing facilities at 401 W. Greenlawn Ave. and 2727 S. Pennsylvania Ave. will be redeveloped as part of the project. The hospital has been working with the Lansing Economic Area Partnership for the last year on the redevelopment plans, Mee said.

The opportunity to redevelop the old facilities is an added bonus for the city, said Bob Trezise, president and CEO of LEAP. He called McLaren's investment "historic" and compared it to GM building plants in Lansing and Jackson National Life deciding to keep its headquarters in the city.

"I see this as a triple win for Lansing," he said. "The city is gong to get three great developments out of this, not just one."

Contact reporter Haley Hansen at (517) 267-1344 or hhansen@lsj.com. Follow her on Twitter @halehansen.