Whitepaper: 01.25.2013

Our New Healthcare Services Leader

Meet New Executive Vice President Healthcare Services Michael Gritters
Longtime McCarthy employee Michael Gritters shares his healthcare construction industry knowledge and goals for the Healthcare Business Unit in Southern California.

Michael Gritters, a 27-year McCarthy employee, was recently promoted to Executive Vice President, Healthcare Services for the firm’s Southern California Division. The change takes place as Steven Mynsberge, who previously served in this role, retired in December 2012 after 33 years with McCarthy.

Formerly McCarthy Senior Vice President of Operations, Healthcare Services, Mike has played a significant role in the company’s success and growth of its healthcare business. He has been involved with more than $3 billion in healthcare work, aiding in all project stages from marketing and preconstruction through project close-out. In his new role, Mike is responsible for identifying and pursuing new healthcare projects and supervising the delivery of preconstruction and construction services on all healthcare projects in Southern California.

“With the explosion of innovative technology such as Building Information Modeling as well as advancements in healthcare technology, this is an exciting time in the healthcare building marketplace,” said Randy Highland, McCarthy California Region president. “Healthcare projects require specialized construction expertise and offer significant challenges. Mike’s commitment in bringing additional value to our clients through the use of technology and collaborative building approaches has been instrumental to our success in responding to those challenges. He has been preparing for his new role over the past year, and I am confident that under his leadership we will continue to provide creative building solutions in response to the competitive environment our healthcare clients face.”

Some of the healthcare projects Mike has worked on include: CHOC Children’s new South Patient Tower in Orange; Phase 4 at Santa Barbara Cottage Hospital; St. Jude Medical Center Patient Tower in Fullerton; St. Joseph Hospital Patient Care Center in Orange; Mission Hospital Patient Care Tower in Mission Viejo; Scripps-Prebys Cardiovascular Institute in La Jolla; Rady Children’s Hospital Acute Care Pavilion in San Diego; Methodist Hospital of Southern California in Arcadia and six projects for Kaiser Permanente in Southern California.

In addition to healthcare building projects, Mike has also been responsible for the management of retail, parking structure and hotel projects as well as six entertainment facilities for the Walt Disney Company.

Mike holds a bachelor of science in construction engineering from Iowa State University and is a U.S. Green Building Council LEED Accredited Professional BD+C. He was, until recently, an active board member of the Associated General Contractors (AGC) of California Orange County District and is currently a member of the AGC Union Craft Committee. He is actively involved with community organizations such as the Children’s Hospital of Orange County’s Corporate Partnerships committee and the March of Dimes.

“We realize that in today’s difficult economic environment, the capital budgets of healthcare owners are extremely tight,” Mike explained recently. “McCarthy is uniquely prepared to build even the most challenging projects efficiently and to provide maximum flexibility in our delivery of services. My goal is to continue building relationships and growing McCarthy’s business in this market by working closely with healthcare building owners and providing them with the most collaborative, Lean and effective construction delivery methods to exceed their expectations and achieve their project goals.”

Mike recently provided some additional insight into his background, goals and the current state of the California healthcare construction industry:

What attracted you to focus on healthcare construction?
I enjoy healthcare construction because it is one of the most challenging types of construction we do in California. But most importantly, the creation of these life-saving facilities provides a huge benefit to society. A great example of this is CHOC Children’s new 425,524-square-foot patient tower in Orange. The new tower will provide leading-edge technology and advanced programs and services in a child-friendly, healing environment. The savings our team was able to provide to the owner allowed them to make many enhancements to the project. Being a part of a project that is saving lives or easing the pain of someone’s illness is truly a rewarding and humbling experience.

How will your construction expertise and healthcare knowledge benefit McCarthy clients?
I learned client focus and flexibility on a series of non-healthcare projects for the Disney Development company in the 1990s. These projects were in a critical environment (the Disney Studio lot) and were technically complex. At the end of the day, these projects provided me with a unique perspective: The entire project cost was nothing compared to the revenue streams that they impacted. This is very similar to the healthcare marketplace. Anything we can do to minimize impacts to our client’s ongoing operations, provide them with certainty as to our results on their project, and make them more efficient will bring huge client benefits.

For the past decade, I have been our healthcare group’s vice president of operations. During that time, our team has built well over $3 billion in healthcare projects. Probably, the most important experiences have been the times I spent on significantly complex projects, working closely with our project teams to overcome unique challenges while still exceeding our client’s high expectations. Understanding firsthand what our people need to do in order to deliver exceptional results has provided me with a unique perspective and appreciation for their extraordinary efforts.

What are your goals in this new role?
I will continue to look for opportunities for improvement on our projects with a focus on safety, quality and efficiency. I also want to enable and encourage our field operations staff to utilize a structured yet flexible approach to meeting our client’s evolving needs.

The use of construction technology and collaborative building approaches will continue to play an important part in the healthcare services we provide for our clients. One such collaborative approach is the Lean methodology of construction. Lean philosophy requires all members of a project team look at the project with a different lens. This methodology works best when we bring an open mind and exhibit a willingness to be more flexible in our approach to designing and building projects so the result is optimized for all team members (owner, architect, engineers, consultants, contractor and subcontractors). I believe McCarthy’s depth of experience in design management, combined with the strong technical capabilities of our field staff, uniquely position us to leverage the Lean approach during the early phases of design, maximizing our ability to increase efficiency and reduce costs.

What are some challenges facing the healthcare construction marketplace today and what trends are you seeing?
The healthcare market in California is currently faced with declining reimbursements, unknowns associated with Healthcare Reform and how it will impact our healthcare client’s business models, and a challenging regulatory environment.

The most exciting healthcare trend delivering incredible results on our projects remains the move toward early collaboration between builders and designers in either design-build or design-assist delivery methodology, combined with BIM/VDC and IPD forms of contract.  We can further leverage these tools on renovation projects to reduce an owner’s risk and uncertainty associated with the challenges of constructing in a “live” environment:  mitigating impacts to patient safety, staff efficiency, etc. Our ability to model existing conditions, convert existing as-built documents to more accurate and efficient electronic documents and then virtually phase and construct these difficult renovation projects will be of great benefit to owners who are open to using these tools on smaller projects.

From a technology perspective, the most impactful trend is mobility. All of our healthcare projects are utilizing BIM in the field. The result is an increase in efficiency and quality, with a corresponding decrease in cost and time required to build these complex projects.

What do you see on the horizon for healthcare construction?
We see fewer of the mega healthcare projects than have been prevalent over the last several years to meet SB 1953 seismic regulations. However, we see more non-acute (MOB and clinics) projects coming online. Construction of new cancer centers or expansion of centers at existing hospital campuses are also on the rise as an increase in cancer diagnosis continues to escalate. We will also see more “repurposing” of existing commercial facilities (retail, office etc.) as occupancy rates continue to languish. There are existing buildings that can be bought and renovated more cost effectively than building new structures.

On the acute care side, I think that demographics and the continuing trend toward consolidation will eventually lead to the return of larger acute care facility construction, but this may take some time. In the interim, smaller renovation projects aimed at increasing efficiency and enhancing the patient experience will likely be an important driver of healthcare volume in the marketplace.

While quite a few projects associated with California SB 1953 regulations, which require specific seismic upgrades for all acute care facilities, are underway or have been completed, a number of facilities are still not in compliance. There are looming deadlines in 2015 and 2020 that will have to be met. In my opinion, the demographics in California will continue to put pressure on our healthcare providers to build new facilities to meet both the legislative mandates for seismic safety and to provide more cost effective facilities in which to deliver healthcare services.

What are some of the greatest opportunities in healthcare construction today?
Lean construction methodology, design-build and design-assist delivery, collaboration and planning enhancements that can be enabled with BIM/VDC and IPD forms of contract. I am confident that by employing the right approach for our clients, staffing their projects with an experienced and knowledgeable team, and utilizing the latest construction technology will enable us to continue to provide the best solutions for even the most complex healthcare project challenges.

Would you like to learn more? To reach Mike and continue this conversation, please contact him at mgritters@mccarthy.com.

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