ESCONDIDO — Neighborhood Healthcare has received city approval to use state bond funds to purchase the medical office building at 488 E. Valley Parkway.
The Escondido City Council unanimously adopted a resolution approving the issuance of no more than $32 million to Neighborhood Healthcare, a California nonprofit public benefit corporation and Federally Qualified Health Center, on Nov. 5.
Although the move required City Council’s approval, the money does not come from the city or obligate the city financially in any way.
Instead, the funds come from the California Enterprise Development Authority, a joint powers authority created in 2006 to address gaps in economic development financing. The JPA provides financing options to non-profits like Neighborhood Healthcare.
The city was required to hold a public hearing under the Tax Equity and Fiscal Responsibility Act (TEFRA) so that the funds could qualify as tax-exempt bonds.
Neighborhood Healthcare intends to use the funds to pay for the acquisition, construction, improvement, furnishing and equipping of the majority of the medical office building.
Neighborhood Healthcare has been a tenant of the building since 2022, providing services including prenatal, laboratory, behavioral and general medical care. Those services will continue along with other expanded services set to take over vacant portions of the property, including pediatric, behavioral health services, and space for medical trials.
Any open spaces on the property for lease will be taken off the market.
Dr. Rakesh Patel, chief executive officer of Neighborhood Healthcare, said the plan is to also keep the other private medical tenants there as well as partners. Those tenants provide services including cranial realignment, general laboratory services, outpatient surgery, endoscopy, gastroenterology and cardiology.
“We’ll work with them – we don’t want them to move out,” Patel told City Council.
Neighborhood Healthcare treats patients throughout San Diego and Riverside Counties. The health center has several locations in Escondido alone, serving approximately 52,000 residents.
Other plans include converting its Date Street location into a PACE (Program of All-Inclusive Care for the Elderly) Center for seniors.
Additionally, the health center will likely close its small practice on Grand Avenue. The location used to be a clinic for seniors but is now used for research clinical trials.
Council was generally impressed by Neighborhood Healthcare’s plans for the future.
“This sounds great,” said Mayor Dane White. “You guys have been fantastic partners in the community.”
Deputy Mayor Consuelo Martinez also recalled previous concerns about whether the 488 East Valley Parkway would remain a medical building after the old Palomar Hospital closed across the street and moved to the Palomar Medical Center on Citracado Parkway.
“One of the fears when the hospital went away was that it was going to be vacant, so I’m glad to have tenants still in that place,” she said.
