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Valley Children’s Hospital unveiled early plans for the future construction of up to 450 units of housing, 173 hotel rooms and 30 shops. (Including a grocery store.)
The hospital is calling its mixed-use development project “The Hill.” It will include five districts — retail, hospitality, recreation and residential areas — that surround its Healthcare District, which includes its main hospital facility, on 443 acres west of Highway 41 in Madera County.
“Our patients and families need more than a hospital, and we need to ensure there is a sustainable financial future for Valley Children’s,” Valley Children’s President and CEO Todd Suntrapak said in an announcement. “The Hill is the perfect expansion of our main campus, designed to meet the needs of our patients and families, support our dedicated team and ensure a sustainable future for Valley Children’s.”
Valley Children’s first announced that it planned to develop retail space last fall, when Suntrapak told The Fresno Bee that the hospital needed to find an alternative revenue stream to ensure the long-term sustainability of its healthcare service operations. The creation of its own mixed-use development around Highway 41 could also make the nonprofit hospital a major player in the increasing economic development of the southeast Madera County region known as Rio Mesa. In recent years, Valley Children’s has expanded its campus in the Rio Mesa area to nearly 500 acres, making the land surrounding the main facility available for future development driven by the hospital.
Long considered a top-notch facility for children and a go-to organization for charitable contributions, Valley Children’s fell into public controversy in March after its publicly released 990 tax form showed multi-million-dollar compensation packages in recent years for the CEO and a group of executives. Local elected officials in Fresno and community members criticized Suntrapak’s pay as exorbitant and questioned the nonprofit’s motivation for entering the commercial real estate development game.
The CEO told The Bee last fall that, although the hospital is fiscally strong, the gap between Medi-Cal’s reimbursement rates and Valley Children’s actual operational expenses could lead to a rocky financial future. He said any revenue generated by its retail operations would only be used for the sustainability and advancement of children’s healthcare. That could look like recruiting more doctors and nurses with specialized training, and creating new medical programs that the hospital doesn’t offer today, Suntrapak told The Bee.
“There’s not going to be any of it diverted anywhere else,” he said about the projected revenue stream.
The Thursday announcement also said The Hill will also strengthen Madera County’s economy, “bringing in new spending, tax revenue and additional tourism.”
The county has high hopes for its southeast corner, expecting the Rio Mesa area to fill with homes and residents in the next 30 years. Master-planned communities Tesoro Viejo and Riverstone have already attracted several thousand new residents to the area.
But there is still no grocery store or bustling commercial district along Highway 41 in Rio Mesa. Suntrapak told The Bee last fall that, besides a grocer, he envisions yoga studios, farm-to-table restaurants, dry cleaners — all of which would are needed by hospital staff and patients’ families, he said.
“We’ve got 30,000 rooftops gone up a half a mile from here, in some cases a little bit less than a half a mile,” Suntrapak told The Bee in an October 2023 interview at the hospital. “The neighbors will be able to access the services, so it’s not just about Valley Children’s.”
The website for The Hill indicates that the project will include 1.2 million square feet of mixed-use space that wraps around the hospital facility.
The hospital has been working on the trail system around its outdoor pond and has added exercise equipment to its recreational spaces. It has also worked on new roads into its campus since last year.
Hospital-oriented development?
Erik Aulestia, a principal at the architectural firm website for The Hill, told The Bee in a November interview about Valley Children’s development plans that the project could fit into what is known as “hospital-oriented development,” or HOD.
“It’s really about being intentional and having an idea about creating a compact, mixed use, walkable place that leverages the economic power of a hospital,” Aulestia said about HOD.
Aulestia thinks the hospital’s plans are a great opportunity to “create a win-win situation”: Valley Children’s would help drive the surrounding development while at the same time becoming a more competitive employer.
“It also comes down to making sure you’ve got the right designer that specializes in creating mixed-use walkable places and that has experience working with developers,” Aulestia said. “Any solution can’t just be pie in the sky. It needs to be realistic. It needs to work with the realities of the marketplace.”
Source Agencies
