Mayo Clinic, Brooks Rehabilitation team up to build $70M hospital on Mayo campus (Courtesy of the Jacksonville Business Journal) — Jacksonville-based Brooks Rehabilitation is making its Arizona debut with the construction of a new hospital at Mayo Clinic’s north Phoenix campus.
This marks Brooks Rehabilitation’s first expansion outside of Florida, said J. Britton Tabor, the company’s executive vice president and chief financial officer.
Mayo Clinic, which also operates a hospital campus in Jacksonville but doesn’t have an inpatient rehabilitation hospital there, has had a long-standing partnership with Brooks, Tabor said.
In Phoenix, Brooks and Mayo Clinic are teaming up to build a 60-bed rehabilitation hospital on eight acres on the south side of Mayo Boulevard along 64th Street near the ASU Health Futures Center.
That land is part of a 228-acre parcel Mayo Clinic won in an Arizona State Land Department Auction in December 2021. While 120 acres of that land is dedicated to Discovery Oasis, a 120-acre biotech innovation hub being developed on the north side of Mayo Boulevard, the remainder of that land is set aside for other Mayo expansions, such as this new hospital partnership with Brooks Rehabilitation.
This new hospital partnership is expected to spur development at Discovery Oasis, said Dr. Richard Gray, vice president of Rochester, Minnesota-based Mayo Clinic and CEO of Mayo’s Arizona operations.
“As we continue to engage with biotech companies for Discovery Oasis, the growth in inpatient care and medical expertise on our campus can only advance the ecosystem of innovation,” Gray said. “We have engaged with more than 275 organizations as we look to develop the right mix of biotech manufacturing, diagnostics, therapeutics and AI-driven solutions in healthcare. We anticipate the first announcement in 2025.”
Mayo Clinic also has a minority interest in the joint venture.
“Brooks will provide direct care to post-acute rehabilitation patients,” Gray said. “As part of the agreement, Mayo Clinic will provide limited ancillary support services.”
Rehab hospital brings ‘unique expertise’ to the Valley
The new rehab hospital comes at a time when Mayo Clinic is experiencing capacity constraints, Gray said.
“Mayo Clinic in Arizona has not provided inpatient rehabilitation care since 2020,” he said. “Brooks Rehabilitation has a proven track record of caring for Mayo Clinic cancer, transplant and stroke patients in Florida, helping them achieve their best recovery and quality of life after treatment. We believe that they will bring unique expertise to the Phoenix area.”
Being near Discovery Oasis is an exciting proposition for the Brooks Rehabilitation team, Tabor said.
“We’re very high on innovation, technology and research,” he said. “We really put a lot of effort into those areas. We believe that’s what drives our excellent outcomes. It’s very exciting to be a part of that.”
Anchor Health Properties will develop the 80,000-square-foot rehab hospital, with Kitchell serving as general contractor, Hoefer Welker as architect and Kimley-Horn as civil engineer. It is expected to open in the summer of 2026, with Brooks set to employ more than 200 people.
Pan-American Financial Assistance Foundation Inc. will own the property and lease it the Mayo/Brooks joint venture. Pan-American is a nonprofit 501c3 affiliated with New York-based Veyron, which is arranging financing for the project. The Phoenix Industrial Development Authority gave preliminary approval to issue $100 million in bonds, with final approval required by Phoenix City Council expected this fall.
Michael Ippolito, senior managing member of Veyron, said his team structured the financing and worked with Morgan Stanley to underwrite the bonds.
“The Phoenix IDA is pleased to have this opportunity to facilitate innovative financing with sophisticated national partners such as Veyron and Morgan Stanley,” said Juan Salgado, CEO of the Phoenix IDA.
While the project is expected to cost around $70 million, Ippolito and his team are seeking approval for $100 million in case project costs escalate before construction.