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Why Minnesota Is A Hub For Healthcare Innovation

Minnesota is a health hub, and the outlook is for more growth, according to the speakers at Bisnow's recent Twin Cities Major Projects event. A lot of those major projects are in the healthcare space, such as Destination Medical Center, Discovery Square and TRIA Orthopedic Center.

These projects are part of the ecosystem of Minnesota healthcare, supported by the University of Minnesota, which is among the top research universities in the country, the Mayo Clinic healthcare system, device-maker Medtronic in Minneapolis and the numerous health-related Fortune 500 companies founded here. 

Park Nicollet Health Services Director, Engineering Robert Riesselman, and Mortenson Development Manager Brent Webb.
Park Nicollet Health Services Director, Engineering Robert Riesselman and Mortenson Development Manager Brent Webb

Mortenson Development Manager Brent Webb said Rochester is now a prime focus of healthcare innovation in Minnesota. With the Mayo Clinic at its heart, Destination Medical Center is the largest public-private economic initiative in the history of the state — $5.6B over 20 years — and the catalyst for healthcare growth in Rochester.

"Mayo's reach is tremendous," Webb said. "Everyone here has been, or knows someone who has been touched by Mayo."

"Discovery Square is a subdistrict of Destination Medical, and I've been fortunate to be part of the team," he said. "We just broke ground on it on Nov. 1. The goal for the property is to be a hub of innovation, and a place that the best talent wants to come to, to work on technologies that save lives."

Park Nicollet Health Services Director, Engineering Robert Riesselman, whose company owns, leases and operates about 3.5M SF of healthcare space in the Twin Cities, said the focus of healthcare development and operation is now on improving patient experience, lowering costs and improving population health.

"Healthcare is more than just sickness care," Riesselman said. "The trend in the industry is a focus on wellness, on being part of a place where healthcare organizations are a service, and a knowledge base, for their clients to help them live healthier lives."

Frauenshuh Inc. Senior Vice President David Anderson, Kraus-Anderson Development Vice President Matt Alexander and and RSP Principal Jon Buggy, who moderated in place of Larkin Hoffman President Bill Griffith, who was unable to attend.
Frauenshuh Inc. Senior Vice President David Anderson, Kraus-Anderson Development Vice President Matt Alexander and RSP principal Jon Buggy, who moderated in place of Larkin Hoffman President Bill Griffith, who was unable to attend

Frauenshuh Inc. Senior Vice President David Anderson said his company is deeply involved in real estate services in the healthcare space. It is a good time to be in that business, since healthcare is as dynamic now in Minnesota as it has ever been. 

"We represent a lot of healthcare users," Anderson said. "We come together with them to determine their real estate needs. In the case of the new TRIA Orthopedic Center, we worked with them on a lengthy site-selection process, driven by business metrics."

Moving to the East metro market was a large part of that effort, Anderson said.

"Criteria for the selection included real estate factors such as visibility, access, commonality with surrounding users and tenants, and demographics — the project brought all of those together. It takes a team to bring all that together."

Kraus-Anderson Development Vice President Matt Alexander said major healthcare development in Minnesota depends heavily on the cooperation and input of all the stakeholders, including the public sphere. And that is not going to change.

The CityPlace redevelopment, which he worked on, involved an intensely collaborative realtionship with the City of Woodbury, Alexander said.

"A master planned community does take a village, and evolving versions of your plan," Alexander said. "You vet the market, and come up with a site plan that fits your clients' needs. We have about 30 acres to go, so we'll be working on it for at least another three years."