Intermountain Health wants a $39 million upzone on the Sears Block. But what will it build?
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An upcoming vote by the Salt Lake City Council to rezone 9 acres of land owned by Intermountain Health near Downtown would give the nonprofit hospital additional value worth tens of millions of dollars.
Yet the hospital chain has been relatively tight-lipped about what it plans to build on the site that for decades had been home to a Sears retail store and massive surface parking lot.
Executives from the healthcare provider have said they wouldn’t provide even a conceptual plan (think rough draft) for what kind of hospital they planned to provide if the capital city agreed to change the zoning of their properties near 800 S. State to D-1, which allows for unlimited height.
They instead have insisted they want to build an “urban hospital” in Salt Lake City, one that would be more centrally located than the existing and aging LDS Hospital in the suburban Upper Avenues neighborhood.
Kip Paul, a prominent commercial real estate broker with Cushman & Wakefield, said he would value the existing land, which allows for buildings up to 120 feet tall, between $78 million and $87.7 million. With the zoning change, that value would jump to $117 million, Paul said.
The value of that upzone is between $29 million and $39 million, though Paul added he suspected that private developers wouldn’t get permission from the city for such a zoning change.
Still, there’s no guarantee or requirement that Intermountain would carry out its stated plans if the Council rezones the land.
The organization isn’t under a development agreement with the city. Until this month, there were no details about what 9 acres of prime land could look like once developed.
That changed a bit during a hearing with the City Council in July, when two executives and an attorney representing Intermountain made their case.
Here’s what we know about what the secretive hospital plans to do at the site.
Pushing past 200 feet
Under updates to the height limits for buildings near Downtown, developers could build structures up to 200 feet without needing additional permission.
Buildings could be any height if they go through a design review process with the city, and one executive suggested that’s the intent with the new hospital on the Sears Block.
“We understand that to get the additional height, we’re going to have to go through the design review process,” said Tyler Buswell, an attorney with Kirton McConkie, which is representing Intermountain. “We understand that. We’ve been following that. We’ve been supportive of that.”
Intermountain officials are implying they plan to build a hospital that is taller than 200 feet if they get permission from the city.
The footprint is already inherently smaller than most of Intermountain’s other hospitals, suggesting a need to build up. (Murray is closer to 60 acres, plus another 30 acres that are leased to Costco, and both have gargantuan surface parking lots.)
Heather Wall, CEO and administrator at LDS Hospital, pointed to hospitals in Seattle and New York City as examples Intermountain is following at the Sears Block.
Such a hospital would likely be a departure from the typical Intermountain hospital in Utah, which commonly features a primary healthcare building surrounded by an ocean of impervious parking.
“This site is going to be very different than anything Intermountain has built in this state,” said Bentley Peay, senior director of real estate for Intermountain. “This will be an urban hospital. It’s going to look and feel very different.”
But there’s no guarantee that any of it happens. And the City Council needs to weigh how much certainty it wants to demand in exchange for giving Intermountain what it wants.
The view of the Intermountain Medical Center (far center) across 60 acres of surface parking in Murray. The nonprofit medical provider says it will not repeat this near Downtown Salt Lake City.
Concerns about activation
Several members of the City Council are concerned that the hospital could be getting a generous rezone that leads to a deadzone near the entry to Downtown.
The hospital will have prominent frontages on State, Main, 800 South and 700 South, as well as mid-block walkways that will be required.
“To me, State Street should be activated,” said Councilman Alejandro Puy. “I’m not talking about a gym or something like that. I’m talking about in and out people. Things that attract people to the sidewalk and activate that street face.”
“To me that would be a deal-breaker, not having the street activation,” Puy added.
Councilman Darin Mano pondered whether Intermountain could lease a few ground floors to private businesses that would help activate the street around the new facility.
“Is there some way that we can go a little bit beyond that and make sure a certain amount of it is used in certain ways?” Mano asked.
Hospitals are well-known for offering the types of sustenance that power overworked medical professionals, like mediocre food in cafeterias and coffee shops.
The question is whether the City Council will find way to entice or require Intermountain to design its facility so that people walking by feel nearly as welcome as patients and employees.
Wall noted the existence of coffee shops and pharmacies, though she mentioned them in the context of patients visiting to pick up prescriptions. She suggested it would be difficult to activate the entire ground floor.
“But our expectation is that we’re creating an area that really draws the community in,” she said. “That’s what a hospital is for, being that center for individuals who need care.”
The city would attempt to require a planned development agreement, where details about ground floor activation would be laid out.
Intermountain is opposed to that type of approach, saying they hope the city’s existing guidelines will be enough to ensure an active ground floor at a functional hospital.
“Lake Sears,” near 800 S. State Street. The temporary water attraction has yet to attract social media influencers despite its close proximity to a high-frequency bus route on State and a new Trax station at 650 S. Main.
Why the Sears Block?
Intermountain officials suggested they chose the site because it would benefit the doctors working on the campus as well as patients visiting it.
The new hospital will benefit from its close proximity to not just a Trax station at 650 S. Main, but also high-frequency bus routes on State and 900 South.
Intermountain estimates it would have 1,700 employees at the hospital each day. Patients from nearly every state also fly or drive in to visit existing Intermountain facilities.
“The accessibility of the bus line, the accessibility of that Trax line and the ability to go north, south and from the airport made this area something that was extraordinarily attractive from a hospital based perspective,” Wall said.
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