Medical Center Board Capital Projects Review November 16, 2006

1. Medical Center Board Capital Projects ReviewNovember 16, 2006 Offices and Research Lab for the Department of Psychiatry Construction of Vanderbilt University Hospital Critical Care Tower, Phase II

2. Research Lab and Office Renovations Psychiatric Hospital at Vanderbilt • This project provides new offices and research lab for the Department of Psychiatry at PHV and The Village at Vanderbilt • It is necessary to accommodate the administrative needs of the new Chairman of Psychiatry, Dr. Stephen H. Heckers, and the Department’s recruitment efforts • The work consists of the buildout of 4,500 SF of shelled space on the Third Floor at PHV for offices and dry lab research space including the following elements: • Four Research Offices and 16 Research Cubicles • Department and Administrative Offices • Two Exam and Interview suites • The work at the Village includes the renovation of 1,020 SF of existing space for clinical and office use

3. PHV - Budget Summary • Architectural Fees $ 47,000 • Construction 520,000 • CPC Fees 18,000 • Survey & Testing 10,000 • Operations 25,000 • Equipment & Furnishings 255,000 • Contingency 25,000 • Total Project Cost $900,000 Construction Cost per GSF = $94.20 Funds for this project are included in the current capital budget and will be made available to the Vice Chancellor for Health Affairs from reserves, gifts and/or anticipated bond proceeds

4. Construction of Vanderbilt University Hospital Critical Care Tower, Phase II

5. Critical Care Tower, Phase IIProject Summary • This is a proposal for the expansion of Vanderbilt Hospital and the construction of the Critical Care Tower, Phase II • The rational and need for this project was presented to this Board in April and September by Mr. Urmy and Mr. Goldberg • During the September Board Meeting, Mr. Goldberg addressed the critical needs and objectives of this project as follows: • Increase Critical Care Inpatient Bed Capacity • Enhance Surgical Capacity & Improve Surgical Suites • Improve Waiting Room & Institutional Amenities • Allow for Future Expansion of Critical Services • This project is planned to accommodate growth through 2020 by providing capacity for focused growth in strategic areas that are consistent with medical discovery opportunities and positive financial returns • Vanderbilt Hospital space is at capacity and services cannot expand without this new addition • The “Certificate of Need” application for this project was granted by the State on September 27th

6. VANDERBILT UNIVERSITY HOSPITALCRITICAL CARE TOWER

7. Critical Care Tower Interiors Existing Elevator Lobbies Nurses Stations Patient Rooms

8. CRITICAL CARE TOWER Phase II Includes: • Construction of Floors 2-10 Shell & Core (292,800 GSF) • Buildout and Equipping of Inpatient Floors 6, 7, and 8 • Buildout and Equipping of 12 Operating Rooms on Floor 3 • Nine additional elevators (3 Visitor, 3 Patient/Supply, 2 Critical Care, 1 Service) • Upgrade of 10 existing elevators • Mechanical Penthouse Floor 11 Subsequent phases will include: • Buildout and Equipping of Cardiac Cath Labs & Hybrid/Cardiac Operating Rooms on Floor 5 • Buildout and Equipping of Inpatient Floors 9 & 10 • Buildout of Floor 2 for Patient and Guest Amenities • Renovation of existing Operating Rooms Construction will start January 2007 Construction scheduled to complete Summer 2009 Section Looking West

9. Vanderbilt University HospitalCritical Care TowerFocused Growth & Bed Capacity • Focused Growth: • 10 Additional Operating Rooms required for FY 2010 & FY2011 • 81 Required Beds at 88% Occupancy for FY2010 and FY2011. Additional beds needed for FY2012 requiring build out of floors 9 and 10 • Bed Capacity: • Beds in Service as of November 15, 2000 511 • Additional Beds from Buildout of Floors 6, 7, and 8 102 • Loss of Beds (6S, 7S, MICU, 8S – 11S) (21) • Beds in Service FY 2010 592 • Net Increase in Bed Capacity 81

10. VUH CCT Phase II - Budget Summary • Architectural Fees $ 11,675,500 • Construction 108,895,100 • CPC Fees 632,700 • Survey & Testing 150,000 • Operations 1,175,000 • Equipment & Furnishings 39,025,000 • Contingency 7,446,700 • Total Project Cost $169,000,000 Construction Cost per GSF = $371.91 Funds for this project are included in the current capital budget and will be made available to the Vice Chancellor for Health Affairs from reserves, gifts and/or anticipated bond proceeds

11. Vanderbilt University HospitalCritical Care Tower Financial Impact – FY 2010 Phase II Critical Care Tower $169.0M Additional Beds in Service 81 Occupancy Rate 88% Patient Days 26,017 Discharges 5,993 Average Length of Stay 4.34 Net Operating Income (Loss) $19.1M EBITDA $33.1M ROI %(completion of project) 22.6%

12. VANDERBILT UNIVERSITY HOSPITALFY 2010