Norwood Hospital ‘shell’ nearing completion but search continues for next facility operator

Cranes, workers in hard hats, gleaming panels of glass bracketed by shafts of steel: the reconstruction of Norwood Hospital appears to be on-track.

“I’ve been watching since they tore it down,” said Tom Sullivan, a mental health counselor who works nearby. “They clearly made progress in the last few months. Looks like it’s going to be a finished building. All we need is somebody to go in it.”

And therein lies the remaining issue with Norwood Hospital: finding a permanent tenant.

“The hospital shell is under construction,” said Norwood General Manager Tony Mazzucco. “Medical Properties Trust (MPT) anticipates that being done in a couple of weeks.”

MPT took over the Norwood Hospital project after Steward Health Care filed for bankruptcy last May. Previously, it served as landlord to Steward properties in Massachusetts -- an arrangement that some blame for the chain’s financial demise because it put hospitals heavily into debt over rents.

Mazzucco said MPT wants out of Massachusetts and is thus only putting in enough construction work to protect the asset until it’s sold.

And that leads to the hard part: finding a hospital operator willing to purchase the property from MPT -- a deal that would also require finishing the interior at a possible cost of $200 - $300 million, Mazzucco said.

“I think if there’s a good deal on the table, they would take it and we would have a hospital operator,” Mazzucco said. “Now, we’ve privately spoken to a number of hospital operators who are interested in the site. There’s some hesitancy to work directly with Medical Properties Trust given the history of Steward’s bankruptcy and some of the challenges the Commonwealth has faced with that.”

Mazzucco said unlike other Steward hospitals, Norwood Hospital was profitable before it closed -- and is badly needed and sorely missed.

“It’s killing our first responders,” he said. “It’s taking ambulances and police cruisers out of our communities for hours at a time. We used to drop patients right here in Norwood and now we’re going to Brockton, into Boston. It’s having a significant impact on health outcomes for the whole region.”

Last fall, the state revoked a previously granted Determination of Need for the rebuilding of Norwood Hospital. Medical Properties Trust is suing to get it back. Mazzucco said once a buyer has been identified -- and pending the outcome of that suit -- the plan is to seek a new, emergency ‘Determination of Need’ -- something required before a new hospital can open.

“It’s absolutely an emergency,” he said. “It’s a public health emergency and it’s a declared emergency for the region in terms of life and safety.”

Mazzucco said the key to moving forward is agreeing on a sale price with MPT.

“MPT is in this for a lot of money and certainly they’re going to want to recoup what they can for their shareholders,” he said. “MPT has not named a price. We’ve asked them if they could. They are willing to negotiate with a viable buyer.”

Mazzucco estimated MPT’s expenditures on the property are likely in the $100 million range -- and include tearing down the old building, site work, permitting and construction to this point.

Something else that could affect the sale price: MPT’s settlement with the underwriter of the property at the time of the 2020 flood, an unknown amount.

Mazzucco said that so far prospective buyers have all been not-for-profit entities with current ties to Massachusetts. But he isn’t ruling out another for-profit hospital operator.

“I wouldn’t say that’s completely off the table,” he said. “But given what we’ve seen with Steward, I think everyone’s priority, I think everyone’s preference, would be for a non-profit hospital. That being said, we need a hospital back.”

Robin Pietrzak and Chrissy Brennan couldn’t agree more. They work across the street from the Steward campus in a medical building.

“We had a lot of elderly patients that were in panic mode because they didn’t know where to go in an emergency,” Brennan said.

“We need to take the burden off other facilities that are covering this area for the lack of Norwood Hospital,” said Pietrzak. “With the promise of it reopening, it will take some of the stress off those hospitals.”

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