Gulf hospital projects in rude health

GCC hospitals are in rude health thanks to continued investment

Investment and building of hospitals across the Gulf largely survived the downturn.
Investment and building of hospitals across the Gulf largely survived the downturn.

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Investment and building of hospitals across the Gulf largely survived the downturn.

Hospitals and medical facilities have seen strong development in the last two years, especially in areas of the GCC that are playing catch-up to provide for their communities.

Many projects are coming to completion this month or in twelve months’ time – timely, some might say, to welcome in a more stable economic environment and higher population growth.

For some developers and contractors they are proving a long-term source of returns, compared to the relative quick bucks
of property.

A key challenge is being able to understand the changing dynamics of healthcare that will inevitably filter through into the specifications of new medical facilities, or upgrades to existing structures.

Both globally and locally there has been an increasing shift from general care to a more customer-tailored service.

At the ‘InnovHealth – Middle East Innovations Summit’ in Abu Dhabi earlier this month, Dr Salem Al Darmaki, acting director general in the UAE Ministry of Health, said the summit allowed “close interaction between healthcare decision makers, planners and professional providers to plan new models and approaches for care delivery and financial systems” to overcome today’s challenges, the biggest of which is to “provide health services based on customers’ focused care”.

This echoed a detailed study by PricewaterhouseCoopers, the financial services and research firm.

According to the latest of its HealthCast series of reports issued by the company’s Health Research Institute, the move to tailored service is similar to that in other service sectors.
At the same time, study respondents agreed that individuals need to take a greater responsibility for their own health – prompting the need for prior research from the medical providers.

“To engage consumers and compete for them in the global healthcare marketplace, health systems are trying to understand consumers’ needs and individual preferences and tailor care to fit them, not unlike other industries that have been transformed by consumerism,” the report notes.

This lean towards the individual, consumerism and franchise has been partially reflected in the expansion of the Saudi German Hospitals Group. The company has five hospitals – four in Saudi Arabia and one in Yemen – that attempt to offer ‘one-stop shop’ for all healthcare needs: medical and surgical specialties and subspecialties including cardiac surgery, neurosurgery, and oncology, and state-of-the-art diagnosis and treatment facilities.

It constructs its own hospitals – employing 1,000 construction workers – and finances its developments with the support of local government and development banks.

Though it may seem contradictory to be both specialist and tailored by service and wide in the total number of services, the company seems to have hit a profitable formula. It now has identical hospitals in different stages of construction in Hail in Saudi Arabia, Dubai, Cairo and Addis-Ababa in Ethiopia.

But specialist institutions are nevertheless moving from the drawing board to the construction site. Last year in KSA, Al Mashrik Company began work on the Arar Hospital for Women & Delivery, a US $50 million project due for completion in a year’s time.

It is just one of a flurry of projects launched by the Ministry of Health to allow the Kingdom to lead the region for health–related infrastructure spending. These projects include a $24 million 100-Bed Hospital in Al-Mokowah and Saud Bin Jalwaei Hospital, and 100-Bed Hospital in Bisha.

Two projects, a $23 million 100-bed hospital in Al-Laith, and a $55 million Al Khobar Hospital are both expected to be completed this month.

The development of specialist institutions has also been bolstered by investment companies. In the last few years, Abu Dhabi-based Mudabala Development Company, the state-owned investment firm, has bolstered its portfolio in the healthcare sector – most recently in a joint venture with Aldar Properties for the $1.9 billion Cleveland Clinic Hospital.

The Tawam Molecular Imaging Centre, operating in partnership with Johns Hopkins Medicine International, was launched last month and features the latest innovative molecular imaging diagnostic technology provided by Siemens, including advanced systems essential to the early detection and tracking of cancer, cardiovascular and neurological diseases.

Other specialist facilities – which have in turn encouraged international partnerships - include the Imperial College London Diabetes Centre in Abu Dhabi and, as part of the 2030 plan for the Emirate, is the Wooridul Spine Centre, the region’s first facility dedicated to minimally invasive spinal care.

Drivers of change in healthcare expenditure
2002/3 to 2032/33
Volume per case: 84%
Price: 9%
Ageing: 3%
Disease rate: 4%
Population: -0.2%

Volume per case: 25%
Price: 5%
Ageing: 48%
Disease rate: 4%
Population: 18%
(source: PwC, figures are global)

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