Background
Palmetto Health, now part of Prisma Health, is the largest health care system in the South Carolina Midlands region. The system includes six acute care hospitals and a network of physicians and advanced practice providers in the Palmetto Health-USC Medical Group and two 501(c)(3) foundations.
Challenge
Palmetto Health wanted to evaluate its entire real estate portfolio in order to optimize the use of its owned and leased facilities, specifically focusing on non-clinical users within its facilities.
Solution
Palmetto Health engaged Hammes Healthcare to develop a system-wide, real estate and space optimization plan with a specific focus on non-clinical/administrative space. The analysis focused on Palmetto Health’s owned and leased non-acute care spaces as well as administrative services within their clinical bed towers. Hammes completed the following as part of its analysis:
- Evaluated the system’s demand for future administrative space (five-year projections)
- Identified the correct industry standards, peer group benchmarks and key performance indicators to use when assessing space needs (including SF per employee by function, facility cost per employee or business unit, etc.)
- Evaluated the capacity of Palmetto Health’s existing facilities to support projected space needs including space excess or shortage at each location
- Identified measures to improve the functionality of Palmetto Health’s current real estate portfolio
- Provided a series of recommended real estate transactions allowing Palmetto Health to reposition administrative space occupants while reducing costs and gaining future capacity
Hammes delivered an action plan outlining the most economically efficient strategy to accommodate Palmetto Health’s projected space needs. In executing Hammes Healthcare's plan and recommendations, Palmetto Health was able to achieve the following:
- Rent/lease savings of $2 million to be achieved over a 10-year lease period
- Relocated 1,200 non-clinical staff to new off-campus location with improved employee satisfaction
- Improved average occupancy SF per person (pp) from 238 SF pp to 138 SF pp (national average is 155 SF)
