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HEALTHY LEVELS OF PROPERTY ACTIVITY AS NEW PROJECTS GET UNDERWAY.

Byline: FRANCIS SHENNAN

Iwas asked on to BBC Radio Scotland last month to discuss why most news is bad news. My answer was that news is what is out of the ordinary and, thankfully, most things go right.

It is easy to forget this, though, so the perspective can become distorted.

Healthcare property is a good example. For general readers and viewers, the dominant story has been the state of Scotland's largest hospital.

The Queen Elizabeth University Hospital (QEUH) in Glasgow, where two patients' deaths were linked to an infection caused by pigeon droppings and which had 300 outstanding repair jobs in March, according to Healthcare Improvement Scotland.

The month before, the health and sport committee of the Scottish Parliament began an inquiry into the country's built healthcare environment. Meanwhile new projects are underway across Scotland.

NHS Grampian has appointed Currie & Brown, the asset management and construction consultancy, to provide project management for the development of an elective care centre at Aberdeen University's Foresterhill campus. It will involve a new build and refurbishing an existing building.

NHS Orkney has also appointed the company as authority technical advisor for the operational phase of a new 172,000 sq ftgeneral hospital and healthcare centre in Kirkwall.

In Inverness-shire, a planning application has been approved for a new 24-bed community hospital in Aviemore. It will be designed and built by hub North Scotland Ltd, one of five geographical "hubCos" in which a public sector body appoints a private sector developer to form a joint-venture.

At Aviemore Balfour Beatty is the main contractor, working with architects Oberlanders in Edinburgh and Rural Design of Portree, and engineering firms Waterman Group and Rybka.

An integrated ophthalmology unit is due to open next spring at the Golden Jubilee National Hospital in Clydebank, offering state-of-the-art treatment care for cataract patients, with Kier Construction Scotland the principal supply chain partner.

Kier has also been working on a PS6m refurbishment programme at Royal Cornhill Hospital in Aberdeen and Dr Gray's Hospital www.insider.co.uk in Elgin, developing designs for a PS4.8m extension and refurbishment at Rowanbank Clinic at Glasgow's Stobhill Hospital, and the design, build and commission of a PS3.7m National Secure Adolescent Inpatient Service in Irvine.

The full PS70m development of the 236,000 sq ftEast Lothian Community Hospital, being built by Morrison Construction, is due for completion early next year.

As Bruce Dickson, regional director of BAM Construction - which is involved in a new Greenock Health & Care Centre and Keppie Design's Mental Health Campus at Stobhill in Glasgow, creating an PS8.5m single-storey residential care for acute admissions and complex clinical care - noted, "these are complex buildings".

This year for the first time, the Scottish Property Awards included a category for Health Care Development of the Year and the three finalists included the Inverurie and Foresterhill Healthcare Project by hub North Scotland.

The winner was the Jack Copland Centre in Edinburgh, designed by Reiach and Hall Architects for Scottish National Blood Transfusion Service (SNBTS). The Centre at the northwest corner of Heriot-Watt University's Research Park, is designed to ensure the safe future supply of blood, tissues and cells for patients.

It consolidates the service's core activities and related services, including processing and testing blood, tissues and cells, logistics and distribution, and research and development. The design aimed to help team integration, with the May 2019 INSIDER 111 Scottish National Blood Transfusiuon staffat work in Edinburgh's Jack Copland Centre. Image (c) Andrew Lee architects seeing the "boundaries" between departments "as areas of connection", rather than as barriers.

"We delight in the power of glass to separate clinically but to connect visually," said their entry.

"It has been our ambition for this project to break the mould - to create a building whose prime focus is the formation of a working team, an excellent place of work where laboratory workers are given the same respect as office workers, with daylight, views out, connection with their fellows and informal places to rest.

"The building has a heart - the arcade which separates (or conjoins) the scientific functions and the offices. All staffpass through this space on their way to work, to lunch and home at the end of their shift."

Eugene Sayers of Sheppard Robson Architects, which has offices in Glasgow, London and Manchester, believes "the confluence of medicine and research is a powerful spur to economic regeneration in our cities, notably in Dundee, Edinburgh and Glasgow."

He added: "Buildings for research or healthcare benefit from the dynamic ecosystem created when these buildings are clustered around significant poles or anchor institutions such as hospitals or universities.

"An example of this is our work at Edinburgh Bio-Quarter.

"Scientists' space requirements are a moving target so buildings need to be robust and adaptable in order not to become a burden or a white elephant. Our work with the Scottish Centre for Regenerative Medicine and the University of Glasgow Centre for Virus Research show the need for flexible, future-proof space."

In primary healthcare the Lothian Bundle of three new health and council hubs in Edinburgh and Blackburn, West Lothian, for hub South East, was the third finalist for the healthcare property award.

Hub West Scotland was behind the new PS17m Gorbals Health and Care Centre in Glasgow which opened in January, bringing together GP, dental and social care practices. BakerHicks provided civil and structural design, alongside JM Architects.

Three more health and care centres are on their way - the Woodside Centre is due to open in summer, after being delayed by a fire during construction, the PS19.3m Clydebank 112 INSIDER May 2019 Centre replacing five current GP practices and including podiatry and physiotherapy services is due to open in July next year, and the PS19m Greenock Centre on the former site of Wellington Academy is due to complete the following month.

"There is a real mixture of primary health facilities across the country from converted Georgian and Victorian townhouses and tenements through to bespoke medical surgeries," said Andy Drane, one of only two Scottish members of UK National Association of Specialist Solicitors Advising Doctors.

"While some facilities, particularly those which are purpose-built, are clearly fit for purpose, many are less than perfect and facing real challenges of obsolescence in the near future.

"Even some purpose-built facilities are ageing and in need of upgrading. From the late 1970s to the early 2000s there was a spate of new surgeries being built, some by GP practices themselves, others by traditional commercial property landlords.

"Much of the leased stock is owned by a handful of specialist investors. Historically they have been seen as a safe investment principally because they are seen as backed by government money with tenants which are typically partnerships where the partners are high networth individuals with unlimited liability."

Premises built in the 1970s and 1980s typically had 25 or 30-year terms so many leases are coming to an end. This will cause headaches for GP practices which are tenants and faced with unfunded liabilities for dilapidations. However, the pattern of tenure is inconsistent across health board areas.

"There is a lot of regulation affecting the GP sector," said Drane, a partner at law firm Davidson Chalmers which advises about a quarter of Scottish GP practices.

"As of April 2018 there is a new settlement with doctors, a fundamental plank of which is to remove premises risk from practices.

"Under the new agreement existing owner-occupier GPs in Scotland will be offered interest-free loans of up to 20 per cent.

"The Scottish Government has also put forward a programme to buy suitable practice premises from owner-occupiers over the next 25 years and take assignations of leases of premises from GP practices that are leased.

"When these leases come up for renewal, the Scottish Government take over the tenancy."

Because practices are usually partnerships, valuations may be carried out because partners leave, retire, mount a buy-out or new partners join the practice.

Chartered surveyor Katie Craig of DM Hall said: "Accurate appraisals are fundamental in times of acquisition or disposal and, in the case of practitioner-owners, for lending purposes.

"It is imperative the purpose of the valuation is clarified as this will determine the basis of valuation. In the case of GPs joining or leaving a partnership, the partnership agreement will normally determine the basis of value.

"In most instances this will be market value where no account of the current market rent reimbursements, cost rent or notional rent is taken into consideration.

"In certain circumstances lenders will request separate valuations having regard to cost rent reimbursement." | www.insider.co.uk The University of Glasgow Centre for Virus Research

There is a mixture of facilities from Georgian townhouses to bespoke surgeries. Some face challenges of obsolescence in the near future Andy Drane, Davidson Chalmers (below)Accurate appraisals are fundamental. In most instances the partnership agreement will take no account of current rent reimbursements Katie Craig, DM Hall (below)
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Publication:Insider Monthly
Geographic Code:4EUUK
Date:May 7, 2019
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