JLL Selected to Bring Prime Mercy Medical Center MOB Project to Market

Phoenix team will represent 80,000 s.f. of medical office space with a broad range of uses

Medical office experts in the Phoenix office of JLL have been selected to market approximately 80,000 square feet of new medical office space planned for one of the last Val Vista Drive-fronting parcels surrounding Dignity Health’s Mercy Gilbert Medical Center in Gilbert, Arizona.

Called Mercy Medical Center, the 80,000-square-foot medical office project is being directed by Scottsdale-based Diversified Partners. It is part of the developer’s new 11-acre mixed-use project which, at completion, will total more than 200,000 square feet of Class A office, retail and restaurant space.

Located on 5.03 acres at the coveted southeast corner of Val Vista Drive and Mercy Road, Mercy Medical Center is immediately south of Dignity Health’s Mercy Gilbert Medical Center, which will soon expand from 212 to 418 beds with the December completion of the hospital’s new Women’s and Children’s tower.

“Gilbert remains one of the fastest-growing towns not only in metro Phoenix but in the entire nation,” said Diversified Partners CEO Walt Brown. “Mercy Medical Center has been envisioned for a long time and we are so proud that its day has finally come. It will bring walkable amenities, resources and comfort to residents, employees and visitors at Mercy Gilbert hospital and its surrounding medical buildings.”

Mercy Medical Center has the flexibility to deliver one large, 80,000-square-foot building or several single-tenant buildings as small as 20,000 square feet. It is being marketed for pre-lease by Patti Gentry, Senior Vice President and co-leader of JLL’s Healthcare Solutions Group in Phoenix, along with JLL Healthcare Solutions Group Vice Presidents Katie McIntyre and Mari Lederman.

“Flexibility and location are overriding selling points of this medical project,” said Gentry. “It has a location, location, location at what is truly Main-and-Main for Southeast Valley medical space. It also offers very broad use parameters, with no ground lease restrictions or hospital privileges required – factors that allow for a wide range of medical tenants looking to enter the market at this prime address.”

Some of these uses could include allergy/immunology, behavioral health, imaging services, physical therapy, cardiology, family practice, fertility specialists, gastroenterology and neurology.

Mercy Medical Center is located directly off of the Loop 202 freeway in Gilbert, Arizona and minutes from the San Tan Village regional mall and shopping centers. Diversified Partners purchased the land site from the Victoria Lund Foundation in mid-2020 and is moving forward quickly with a development and site plan, to include multiple access points, extensive parking, easy drop-off and pick-up, and prominent monument signage visible to more than 59,000 vehicles per day.

According to Diversified Partners, over 1 million square feet of medical-related businesses are scheduled to open less than one mile from the Mercy Medical Center site by 2022. More than 800,000 square feet of that space is scheduled to open in 2021 or sooner.

“This is an exceptionally strong submarket, with over 1.2 million square feet of existing medical office space at just 10.20 percent vacant and pre-leasing keeping an active pace alongside new construction,” said McIntyre. “Market asking rents also continue to climb – by 27 percent in the past five years alone.”

Existing medical neighbors to Mercy Medical Center include Mercy Gilbert Medical Center, OrthoArizona, Ironwood Cancer Center, Phoenix Children’s Hospital and The Oaks/Merrill Gardens assisted living and memory care community.

Pre-leasing is underway now at Mercy Medical Center, with space ready for delivery as early as year-end 2021.

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