13. Conversion Areas
(Doug): Are there particular areas of the hospitals that are more favorable for conversion of a behavioral health unit?
(David): Definitely. I think probably the prime candidate for renovation into a behavioral unit is a former nursing unit, and preferably one that has been updated or renovation has incurred in the last decade or so. That is typically the best space because the majority of the space that you are using is bedroom space, sleeping room, so I think that makes it ideal. The older the building the more costly the renovation of the space, if it hasn’t been touched in a while, and that gets back to those systems questions of how old are the mechanical units? How old is the electrical system and the panels and so forth? And so the newer the space of course probably the less cost that has to go into renovating it. The place that is the least ideal and maybe tempting is medical office building space. So it’s continuous to your campus. A lot of times you may have an open floor that you’re trying to lease, but that building is typically built to business occupancy standards and not the institutional standards of a hospital. And so trying to convert that to institutional space can be very invasive and very cost prohibitive.