A $20M psychiatric hospital is headed for Old East Dallas.

Developer Prevarian Cos. has begun renovating a former Parkland Health clinical office building at 3320 Live Oak St. to make way for PAM Voyages Behavioral Health, a 65K SF inpatient facility with 72 beds and specialized programming.

As the second private acute psychiatric hospital in Dallas, Voyages is intended to address the surge in demand for inpatient behavioral care in the Metroplex. Outpatient care will be available in an adjacent building.

Pennsylvania-based PAM Health is the hospital operator behind the Voyages brand.

"At a time of acute need for psychiatric services, this hospital in Dallas represents a visionary investment by PAM Voyages,” Prevarian Cos. partner and co-founder Allan Brown said in an email. “It promises to deliver great benefits for patients, families, and the healthcare professionals who treat those dealing with mental illness."

There are just 18 psychiatric care beds for every 100,000 people in the U.S., Brown said at a Bisnow event earlier this month. That ratio has declined significantly since the 1950s, when there were 337 beds for every 100,000 people and the nation was home to half as many people as it is today.

Texas is one of the lowest-ranking states in terms of its access to psychiatric care, with only five beds per 100,000 residents, per Becker’s Behavioral Health. Mental healthcare is not reimbursed by insurance to the same degree as other types of care, which means funding for new behavioral health facilities is extremely tight, Brown said.

“We have not talked to one acute care provider nationally, not one, that does not have a need,” Brown said at the Bisnow event. “No matter the size, whether it’s national, regional or local systems, they all have a need.”

Behavioral health hospitals have a development budget of about $400K per bed, while sizable acute care hospitals have budgets of up to $3M per bed, Brown said.

“[Behavioral care] is not sexy, and it’s certainly not reimbursed the way that cardiology and oncology and neurology are compensated,” Brown said on the panel. “The supply-demand curve is not mysterious, in many cases it’s just a matter of cost.”

These types of projects are critical in Texas, which ranks dead last in terms of labor availability for youth mental health care, a 2023 study reported by KERA found.

Voyages isn’t the only facility seeking to alleviate the shortage. MetroCare is building a new $90M campus on Westmoreland Road near I-30, and behavioral health hospital Collin Springs opened last month in McKinney.

PAM Voyages is scheduled to open in 2025, Brown said.