BLUFFTON, SC-For many years, hospitals and health systems shied away from competing with each other directly. These days, however, as health systems face a need to grow and expand, most are willing to meet their competitors head on, often building facilities near another system's hospital or outpatient building.

A case in point can be found in Bluffton, SC, where Rendina Cos., a healthcare real estate and development firm situated in Jupiter, FL, recently broke ground on a $16 million, 60,000 square foot outpatient facility that will offer services ranging from orthopedics to breast health.

The two-story outpatient center, known as Bluffton Medical Campus, will carry the flag of Hilton Head Regional Healthcare, whose hospital, the 93-bed Hilton Head Regional Medical Center, is about 10 miles to the east on Hilton Head Island. Rendina found and acquired the site as a strategic location for Hilton Head Regional, a subsidiary of Dallas-based Tenet Healthcare Corp.

The new building is going north on 12 acres near the intersection of Buck Island Road and US 278 – the road leading out to the island. The hospital will occupy about 80% of the building. Furthermore, the site, as alluded to earlier, is within a block of an outpatient facility occupied by a Hilton Head Regional competitor, Beaufort (SC) Memorial Hospital.

In an interview, Todd Varney, Rendina's executive vice president of business development, acknowledges the building will be in close proximity to the one occupied by Beaufort. And while Varney notes that competition is a big part of today's healthcare sector, he says the location would have been a good one for Hilton Head Regional whether or not Beaufort offered services nearby.

“It's an area with growing demand for healthcare services,” he says, adding that Rendina expects the remaining 20%  of the building to be leased by the time of its fall 2013 opening.

At the recent groundbreaking for the project, Mark O'Neil, CEO of Hilton Head Regional Healthcare, said the "state of the-art” center will be home to numerous specialized healthcare services, such as breast health, orthopedics, diagnostic imaging, various types of therapies and doctors' offices.

An outpatient imaging center will be on the first floor, as well as a CT scanner, nuclear camera, diagnostic x-ray, bone density and ultrasound services. The first floor will also be home to the Breast Health Center and include a separate entrance to the imaging center. “It's a one-stop-shop concept where people can get most of their healthcare needs met right in their own community,” O'Neil said. “We're calling it a hospital without beds.”

According to Varney, the project is the second that Redina has developed over the last decade or so for Hilton Head Regional; the other is further inland. For Rendina, which will own the facility, the start of the project also marks the start of a busy time, as it has six projects either under construction or in development as well as another three or four pending deals, he adds.

John Mugford is the Editor of Healthcare Real Estate Insights™, the nation's first and only publication totally dedicated to covering news and trends in healthcare real estate development, financing and investment. For more information, please visit www.HREInsights.com.