Swedish's preferred development parcel, which it has underoption, is a 15-acre lot located in the Issaquah Highlands on theeast side of Highland Drive that is owned by Port Blakely. Thefirst phase of the hospital is expected to be up and running in2012. All three phases are expected to cover about 10 acres, withthe remainder to be used for other uses, possibly medical officespace.

Swedish filed its original application with the state in 2004.Overlake Hospital and Medical Center filed a similar applicationshortly thereafter. The state denied both applications in 2005,saying there was no need for a hospital based on its count ofavailable beds in the region.

Swedish and Overlake both appealed and an administrative lawjudge upheld the state's original decision. While Overlake stoppedthere, Swedish appealed again, arguing that the state should nothave included in its count 132 beds from Group Health EastsideHospital in Redmond because the it was scheduled to be closed on2008. King County Superior Court Judge Bruce Hilyer agreed andremanded the decision back to the state.