|HUD No. 09-192
September 30, 2009
HUD APPROVES $2.3 MILLION DEAL FINANCING RENOVATION AND EXPANSION PROJECT FOR HOSPITAL IN OSWEGO, NEW YORK
WASHINGTON - The U.S. Department of Housing and Urban Development today announced a commitment to insure a mortgage loan to Oswego Hospital in Oswego, New York to finance the consolidation and renovation of the hospital's laboratory facilities and expand the emergency department. The $2,345,000 loan is made possible through the Federal Housing Administration's Section 242 Hospital Mortgage Insurance Program.
"FHA is helping to build state-of-the-art health care facilities all across the country," said FHA Commissioner David Stevens. "By lowering the cost of credit, FHA will allow Oswego Hospital to use more of its resources to provide quality medical care."
Currently, the hospital's laboratory services are located in three areas: a main 2,824 sq. foot laboratory, a 572 sq. foot area in the pathology department, and a cytology laboratory located in a 130 sq. foot temporary area. The new location for the laboratory will have 5,262 gross square feet and will allow for more efficient use of staff and improved workflow. A portion of the vacated laboratory space will become part of the expanded emergency department to be constructed with the $14.4 million HEAL-NY grant.
By insuring the mortgage loan, FHA is enabling Oswego Hospital to obtain lower cost financing, saving the hospital more than $700,000 in interest expense over the life of the loan.
HUD estimates this construction project will create 88 full-time jobs and provide an estimated economic stimulus of $6.4 million to the community.
The new construction will enable the hospital to provide services in modern space and to maximize the efficiency of patient care. The closest competing hospital recently closed and other competing hospitals are located 40 miles away.
This project is not the first time that HUD and Oswego Hospital have worked together. In December 2006, Phase I of the Hospital's Renewal Project was completed with financing provided by a $26.4 million Section 242 HUD-insured mortgage.
FHA's Section 242 Mortgage Insurance Program for Hospitals provides HUD-insured mortgages made by private lending institutions to finance construction or renovation of acute care hospitals including major equipment needed to operate the facility. The eligible applicants can be public, proprietary, or nonprofit hospitals certified by the responsible State agency.
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