Potential Avista move ratchets up pressure on Louisville leaders

LOUISVILLE — Leaders with AdventHealth Avista turned up the heat on the years-long Redtail Ridge debate Tuesday, suggesting during a Louisville City Council meeting that the hospital might look beyond city limits for its planned new facility if the mega-development off U.S. Highway 36 again fails to clear regulatory hurdles. 

“We can’t wait any longer,” Dan Enderson, a regional executive with AdventHealth, told members of the Louisville City Council.

The board met Tuesday to consider a preliminary plat application from Redtail developer Sterling Bay LLC. At about 11:30 p.m. on Tuesday night, after several hours of presentations from Louisville planning staffers and representatives of the developer, City Council voted to continue the hearing to Feb. 20, when officials will ask questions of the applicant and members of the public will give comments before a vote on the plat. 

Redtail representatives, including Avista officials, stressed the importance of a swift resolution to the Redtail approval process, which has dragged on for the better part of a half-decade. 

“We had hoped to be well under construction by now,” Enderson said, adding that any suggestion from previous Avista officials — who were on duty during the breakup of the Centura Health network of hospitals — that the hospital would remain in Louisville regardless of Redtail’s approval are not reflective of the current administration’s position.

CommonSpirit Health and AdventHealth, two religiously affiliated health care systems that combined in 1996 to form Centura Health, announced last year that they would begin dissolving their Centura partnership, a network that included 19 hospitals in Colorado and western Kansas.

Chicago-based CommonSpirit Health, the nation’s largest Catholic health system, owns Longmont United Hospital, while AdventHealth, based in Altamonte Springs, Florida, owns Avista Adventist Hospital in Louisville.

“Our goal is to stay in the Louisville community. However, we need the opportunity to expand and have better access than we have today,” Enderson said. 

Avista has been under contract for about two years to buy about 40 acres on the Redtail site at the interchange of U.S. Highway 36 and Northwest Parkway, where it plans to relocate from its existing building at 100 Health Park Drive.

Hospital leaders have long said that Avista suffers from accessibility issues. The hospital’s vulnerabilities were highlighted during the Marshall Fire in late 2021. 

The site is accessed only by Health Park Drive, which dead-ends at the hospital. Over the years, the hospital has been unsuccessful in securing a new interchange off of U.S. Highway 36. Poor access adds to the time required to reach the facility, making it difficult to attract new patients.

Additionally, Avista’s landlocked location does not offer opportunities to expand, hospital officials have said, with the community missing out on potential new services because the hospital has no room to grow. A new hospital at Redtail Ridge would provide Avista with a far larger market service area, putting it closer to a wider population base.

While Sterling Bay officials said Tuesday that Avista would likely be Redtail’s first major tenant, the project is much broader than the hospital, encompassing roughly 300 acres where more than 2 million square feet of commercial space — including a biotechnology campus — could eventually be built. 

Denver developer Brue Baukol Capital Partners LLC bought the former Phillips 66 (NYSE: PSX) site, which was previously home to a massive Storage Technology Corp. campus, in 2020 for $34.93 million. As part of a July 2022 real estate transaction conducted by a series of holding companies, Sterling Bay acquired the property from Brue Baukol for just under $128 million, Boulder County warranty deeds show. Brue Baukol remains a minority partner in the development. 

When Sterling Bay entered the picture, the developer added plans for flex-lab-office spaces aimed at biotechnology tenants, a red-hot subsector of the Boulder Valley commercial real estate scene in recent years. 

The Redtail Ridge development team has spent the past four years attempting to shepherd its project — which has undergone significant changes several times based on feedback from Louisville officials and residents — through the city’s development-approval process. 

The Louisville Planning Commission, on a 3-2 vote, recommended denial of Redtail’s previously submitted final plat in December 2022. That recommendation came after an April 2022 special election in which Louisville voters repealed a previous approval of the project by city officials.

Concerns from residents and city officials — mostly centering around flattening of the site, traffic, the size and location of public spaces, sustainability and economic viability — have nagged Redtail Ridge for years.  

The latest iteration of Redtail Ridge, which is expected to be built in phases over the next decade and includes about $25 million in public improvements from the developer, calls for a total of about 2.5 million square feet of commercial space, according to planning documents submitted to the city. 

The first phase, set to be underway by 2026, would include 509,260 square feet of industrial space, 300,000 square feet of life-sciences space and 598,940 square feet of manufacturing practice-rated (GMP) space, according to the documents. 

Phase 2, to be built by 2030, calls for another 118,800 square feet of industrial space; 90,000 square feet of office space; 264,000 square feet of research and development space; 14,000 square feet of retail; a 285,000 square-foot, 160-bed hospital (Avista); and 150,000 square feet of medical and dental office space, according to a land-use chart included in a planning memo.

The third phase, expected to wrap up around 2035, includes another 270,000 square feet of general office space.

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