How much does it cost to build a hospital?

Reviewed by Adam Graham remodeling expert. Written by Fixr.com.

Healthcare is an important part of any society, and one of the essential pieces of a good healthcare network is the hospital. It is a place where people can be treated and released for emergencies, cared for long term, or scheduled for emergency and outpatient procedures. Hospitals come in many forms, in terms of size, shape, location, the overall goal of the hospital, and who they plan to treat. Because of these factors, there is an incredibly wide range of associated costs with building a hospital. The average hospital needs roughly 2,500 sq.ft. per bed, which makes a 120-bed hospital roughly 300,000 sq.ft.

The national average cost to build a hospital ranges from $60,000,000 to $187,500,000. The average project costs $112,500,000 for a new 300,000 sq.ft. hospital that includes administrative areas, emergency and operating rooms, and enough space for 120 beds. At the low end, projects could be as low as $52,200,000 for a 150,000 sq.ft. micro hospital with 60 beds, an emergency department, outpatient surgical facilities, and limited administrative areas. Some private, large hospitals could cost as much as $210,000,000 for a 500,000 sq.ft. hospital with 150 beds, administrative areas, specialty units, and extensive operating and emergency rooms.

Costs to Build Hospital

2022 Notice: The Effect of the Pandemic on the Construction Industry

The pandemic has had an enormous impact on hospitals around the world. Not only are many hospitals finding themselves short on resources and space, the overload of the industry has spilled over into hospital construction as well. Hospitals have been forced to delay or cancel many outpatient procedures during the pandemic, which has slowed revenue. This, combined with a shortage in materials and labor, as well as an increase in building costs has meant that many hospitals cannot expand or build new buildings.

At the same time, the pandemic has showcased many issues within hospitals, such as lack of seating, barriers, and inadequate ventilation. This means that as investors and hospitals are able to start funding new hospitals, there will be industry growth as these needs are met.

High construction costs are expected to continue through 2022. Hospitals and hospital builders looking to break ground may want to sign contracts quickly to help lock in costs now before they rise again.

Hospital Construction Cost per Square Foot

On average, the typical cost per sq.ft. to build a hospital ranges from $200 to $625, depending on the location of the hospital, its size, and whether it is a general or specialty hospital. Many factors go into making up the cost per sq.ft. of a hospital. The type of hospital influences costs. For example, teaching hospitals need more square feet per bed than other hospitals. Trauma centers and specialty care hospitals require different equipment or more specialized spaces, which can increase costs.

The location affects total costs. Not all sites are ideal for building a hospital, which must be located on clean, level ground. Some areas have higher construction costs, with major cities typically having a higher cost per sq.ft. than suburban or rural areas. The configuration influences the costs, with larger buildings sometimes working out to a lower cost per sq.ft. since material fees can be lower when the volume increases. Remodeling costs for converting older buildings into hospitals have different costs per sq.ft. It is not uncommon for older buildings to be used as the base of a new hospital, combining remodeling, conversion, and new construction costs.

Hospital Construction Cost per Bed

The average cost of hospital construction per bed ranges from $500,000 to $1,500,000, which usually depends on the type of hospital and how much square footage per bed is required. The beds are a large part of every hospital. Beds are in the ER, trauma centers, pre- and post-surgical areas, and short-term and long-term inpatient areas and waking rooms. Not all beds are the same size or type. Hospitals that handle infants and children have cots, cribs, incubators, and beds for children and adults.

Most of them are sized by the number of beds. It is common for hospitals to break down their total number of beds by area. New hospitals need to allocate space specifically for patient beds, such as 590 to 810 sq.ft. per bed. The total number of beds may be determined by how many people the hospital expects to treat each year. For example, a hospital expecting to treat 1,000 patients needs 200 beds in a general hospital, 170 beds in an emergency hospital, and 26 beds in specialty hospitals. In the table below, we’ll show the average cost of building a 50-bed hospital versus the cost of setting up a 100-bed hospital for reference and comparison.

Average Cost to Build a Hospital by Type

The average cost to build a hospital based on its type ranges from $200 to $625 per sq.ft. The cost depends on several factors. Private smart hospitals with more square footage per bed or room and premium equipment and furnishings have a higher construction cost than a small, rural emergency hospital with limited services and bed space. In the table and subsections below, we will look at the most common types of hospitals, their average construction cost per sq.ft., and what factors determine the costs involved.

Emergency Hospital

While they’re larger than a micro hospital, emergency hospitals are still smaller than a full-scale hospital project and cost about $200 to $500 per sq.ft. Here, the size and the level of equipment needed are usually what impact the costs. They are not necessarily built using the same materials, techniques, or finishing practices as full-scale general hospitals. Instead, they are designed to be makeshift buildings, often constructed out of prefabricated compartments, such as shipping containers. Some may also use ICF blocks and other materials that can go up faster than traditional stick builds.

While a full-scale hospital takes months to build and fully equip, there are times when hospital rooms and beds are needed more urgently, such as during pandemics. In these cases, emergency hospitals may need to be built in days or weeks to accommodate the sudden spike in patients and their need for beds. These hospitals are not meant to be used long term, may have safety concerns, and do not usually have operating theaters, long-term care, or services that a full-scale hospital offers. They are rare and have not been built in the U.S. If shipping containers like those used to build homes and other structures are used, it’s conceivable that a similarly-sized hospital could be constructed for about half the price.

Micro Hospital

A micro hospital has a cost per sq.ft. of $280 to $400, depending on the features and exact specifications of the facility. Costs to build them range considerably, depending on the type of care they provide and exactly how many beds they offer. Since most are considered larger versions of an emergency department and are much smaller in size comparatively, their costs are lower than the total cost of a full-scale hospital.

They are a new idea in medicine that creates a smaller facility designed to take some of the patient load from larger hospitals, reduce stress, and eliminate the large costs of building a new full-scale hospital. They are intended to treat 30 to 60 patients a day, often those with more complex needs than can be handled by an urgent care facility. Patients requiring more specialized care can be sent to a full-scale hospital. This type of facility acts as a midway point to determine the best course of treatment for more complex issues.

Smart Hospital

The modern organization may decide to construct a smart hospital, also known as a modular hospital, which costs an average of $500 to $625 per sq.ft. This project consists of assembling prefabricated modules into an arrangement or layout that serves patient care most effectively. These rooms contain several advanced features, like sliding automatic doors and surfaces that are non-porous to reduce infection risk. They have intelligent daybeds with window controls. Frosted glass comes standard to improve patient technology. Rooms are wired for smart technology for hospitals that wish to integrate that into their infrastructure.

While the cost is higher initially, prefabrication speeds up the construction project by as much as 40%. When they say time is money, they mean it. Spending almost half the time on construction means big savings on the budget and the bottom line because the hospital can be functional sooner. Developers can repay loans and save interest by repaying sooner. Facilities can be ready to go in a hurry, which can be helpful in underserved areas or areas where the only hospital-like facility was damaged or destroyed, and this one serves as a replacement.

Average Labor Cost to Build a Hospital

The average labor cost to build a hospital ranges between $30 and $500 per hour for hourly labor. However, some individuals charge by the sq.ft. or as a percentage of the job, which you will see in the table below. Labor takes up to 60% of the costs of building a hospital, while materials take up the other 40%. Many workers are involved in the building of a hospital. Each has a different labor cost, which varies depending on the location and scope of the work. In many ways, the construction process for a hospital is like any build. A site is chosen and evaluated. Structural engineers assess the site, and architects and engineers draw up plans. The goal of the hospital is taken into consideration during the planning to ensure that the layout and design meet the needs.

The site is cleared and prepped to begin building, and the foundations are poured. Typically, they are built using steel frames and masonry or other flame-retardant materials. Once the structure is created, the interiors are constructed, making sure that all interior walls are built using flame-retardant materials and finishing materials that are non-microbial whenever possible, such as linoleum flooring and brass door plates. Electrical, plumbing, and ventilation are roughed in before the finish work on the interior. Then, the exterior is finished with appropriate doors and windows.

The equipment is installed, with larger equipment brought in earlier before the interiors are finished to make the installation easier. Most finish work, such as cabinets, countertops, painting, flooring, and bathroom fixtures, is completed in the same manner as any other project. Beds, furnishings, and supplies are added last. In the table below, you’ll see a breakdown of the average labor costs based on the type of worker or project required in constructing a hospital.

Parts of a Hospital

Hospitals include several different segments, or parts, that are involved in playing their own role in the overall function of the facility. The existence of these elements and segments impacts the design and architecture of the building. It will be important to include all of these in the planning stages. In the table and subsections below, you will see a breakdown of each part and how it impacts the planning, design, and construction, along with any costs that are possible to provide. In some cases, projects may be case-specific or contain too many variables to provide accurate cost information on a general basis.

Hospital Administration

The administrative areas are generally less expensive to build, costing between $150 and $200 per sq.ft with an average total cost of $450,000 to $600,000. They need a section of offices and an area for administration in addition to patient treatment and care areas. The administration is generally in a separate part of the hospital from patient care but needs to be accessible from the hospital and from a separate entrance. The size of the administration section varies based on the type of hospital. For example, teaching hospitals may have a larger administration area than trauma hospitals to accommodate visiting specialists and teachers.

Hospital Capacities

All hospitals include hospitality capacities, such as housekeeping, laundry, and food services, all of which require space in the building. They have an average cost of $450,000 to $1,000,000. These essential services will be found in all hospitals, but their location and size vary depending on the size of the hospital, its design, and layout. Several factors affect the cost of building these various facilities, which will be further explained in the subsections below, along with the average costs of each.

Hospital Food Service

Generally, these areas have some of the lowest building costs, starting at $100 to $125 a sq.ft. Kitchens, restaurants, eating areas, and lounge areas with facilities for reheating and storing food are part of the design and layout. The size of these areas directly correlates to the type of hospital and number of beds and healthcare workers. The kitchens and larger service areas are usually located on the north side of the building but may be more centrally located in some layouts.

Hospital Cleaning Service

The average cost to construct the cleaning and janitorial areas of a hospital ranges from $150 to $300 per sq.ft., depending on the type of spaces constructed for the cleaning service and the features or equipment included. Housekeeping and laundry are important parts of the hospital, helping it run smoothly and efficiently while making sure that things stay sanitary. Offices or areas for these services are usually located in the north of the building, usually near an exit for easy supply and transfer of linens.

Hospital Safety Standards

The cost of hospital safety standards ranges from $500,000 to $3,500,000, depending on size, system, and other factors. The safety standards make up a large part of the utilities and function, and include specific areas like electrical work and ventilation. These systems are responsible for maintaining a safe, secure, and sanitary environment regarding all equipment and materials used within a hospital setting regularly. In the subsections below, you’ll see a more detailed look at the various safety elements involved in hospital construction, including average cost estimates where possible and further information about each type of system or standard that is in place.

Hospital Sanitation

There are several workers in this particular area, but plumbers make up the bulk of the roster and charge between $45 and $200 per hour for their services. Sanitation includes the plumbing for the building, with specialized looped plumbing preferred. For each bed, the plumbing must accommodate at least 110 to 120 gallons of water per day. In addition, decontamination areas, sterilization areas, and waste management fall under this category.

Hospital Storage and Supply Areas

Storage and supply areas in the hospital will typically cost about $280 to $300 per sq.ft. to construct. The total cost depends on the amount of storage space needed. Supply takes many forms, including utilities, food, linens, and medicine. Supply areas are generally dictated by local codes. They are usually located on the north side of the hospital, if possible, with all supply areas located nearby to streamline operations and ensure efficient patient care.

Storage facilities for the anesthesia and any medication need to be factored into the layout and design. They must be easily accessible, secure, and adequate for the number of beds. Also, the area the anesthesia is installed in must be completely covered in non-conductive materials. The relative humidity of the room must be kept between 60% and 65%, requiring the addition of humidistats and controls. This could increase the cost of construction for these areas, depending on the equipment needed to maintain these conditions.

Hospital Oxygen and Gas Supply System

The average costs related to oxygen and gas supply systems for a hospital range from $200,000 to $1,500,000. Many inpatient rooms, plus operating rooms and the intensive care unit (ICU), need to have pumps for oxygen, nitrogen, and vacuumed and pressured air. Automatic switches must be included, and the necessary power to operate them. These systems vary in size and capability. They also differ in the types of gases they can supply and may or may not be needed in all hospital spaces. However, the installation and upkeep of these systems is a critical safety standard and requirement for patient safety and standards of care.

Hospital Radiology

Hospital radiology areas need to be properly constructed with lead lining, which makes up about 5% of the total cost, or about $600,000 to $700,000, based on the project in the introduction. The exact thickness of the lining depends on the type of equipment and that equipment’s specifications. Radiology is generally centrally located in the hospital, with equipment and furnishings that meet all regulatory standards and safety guidelines installed properly and signed off on before use.

Hospital Electricity

The average cost of electrical work in hospital construction generally runs from $3 to $4 per sq.ft., or a total of $900,000 to $1,200,000 for the entire job, plus the additional cost of the lights and their monthly maintenance and running costs. Electricians can charge per hour, while many price the job of wiring a building by the sq.ft. The electricity and load that a hospital needs to carry to function safely are vital for safety standards. This includes the ability to carry 120 V, 220 V, and 380 V for high current. Lights in the hospital need to be at least 1,000 lumens in operating rooms and 500 in other areas.

Hospital Ventilation and Airlocks

There are too many variables involved in installing hospital airlocks and ventilation systems to narrow down the costs. However, you could expect to spend between $1,500,000 and $3,500,000 on airlocks and ventilation. These systems are crucial to the hospital and must flow properly to deliver the correct amount of airflow. In a hospital, filtered air needs to enter rooms but not exit in cases where isolation is necessary or in surgical settings. This includes renewing as much as 15 to 20 volumes of air per hour in each room.

Operating rooms must also have hermetically sealed doors so that once they close, the only air circulating is the filtered air within the room. Hospital ventilation includes airlocks or hermetically sealing doors between spaces as needed, such as the areas where workers change into or out of protective clothing or where equipment is cleaned and sterilized. These systems generally make up a significant portion of the major safety and functional system costs.

Hospital Medical Units

Several medical units within a hospital have an average construction cost ranging from $250 to $625 per sq.ft. These include the various units and areas within the hospital where patients are treated, and various services are administered. Not every hospital has the same type or number of functional units. For example, some may not have maternity wards, and the average ICU room cost will be much higher than a standard room. In the subsections below, you will see more detail about each of the hospital medical units that may be included, along with their average costs and what each entails.

Hospital Patient Room

The average patient room cost is $250 to $450 per sq.ft. to construct, depending on the type and size of the room and the features included. Some patient rooms will include basic features and limited amenities. Others may include only a single bed, premium amenities, and privacy features that add to the construction costs. Consider how many of each type of room you want to balance the budget accordingly. Be sure to factor in additional equipment and supply costs that will come later.

Hospital Emergency Room Cost

The average emergency room costs for construction range from $280 to $400 per sq.ft. Emergency rooms are integral to many hospitals, particularly those that contain trauma centers. They are usually located in a wing of the building rather than centrally located. They need access points for ambulances, ambulatory patients, and staff. The size and layout of the emergency room vary by the size of the hospital. They usually include reception areas, triage, waiting rooms, treatment areas, and connections to the central area of the hospital where radiology and other services are located. The average ER cost varies depending on its size, features, equipment, location, and other factors.

Diagnostic Units

You can expect to spend about $300 to $350 per sq.ft. on diagnostic units. Diagnostic and treatment areas incorporate several functions and may require various specialty equipment, which makes up about 5% of the total building costs. These areas vary depending on the type of hospital and its function. Many are located near the emergency room, while some hospitals also have outpatient areas, intake areas for diagnostics and treatment of short-term patients, and areas for rehabilitation for longer-care patients. These areas may be located centrally or placed near inpatient areas.

Medical Surgical Unit

The medical surgical units in a hospital generally have the highest cost, starting at $350 per sq.ft. and approaching $625 per sq.ft. for some specialty hospitals. This is because of the high cost of the medical equipment, ventilation, and special lighting necessary in these areas. While surgery can be considered one unit, it is actually broken up into several smaller units, including preoperative, postoperative, waking rooms, apparatus storage, storage and facilities for anesthesia, the operating rooms, and the sanitation areas for healthcare workers.

They also include waiting rooms for families and administration. They require separate airlocks for both patients and healthcare workers. The head nurse’s office may be located here, in addition to offices and space for the other nurses and healthcare workers. Some surgeries are centrally located to provide better access to and from other areas of the hospital. Others are connected by annexes to facilitate better movement. However, it depends on the type of hospital and its design, and it all impacts surgical and operating room costs in construction budgets.

Hospital Maternity Ward

The hospital maternity ward costs around $400 to $500 per sq.ft. to build. Not all hospitals have maternity wards, but many do. A maternity ward has accommodations for nurseries, pre- and post-birth rooms, operating rooms, waiting rooms, and even possibly high-risk nurseries or delivery areas. It needs long-term beds for women waiting for birth and short-term beds for those going home within 24 hours. Some maternity wards also include birthing pools, midwife accommodations, and care teams for both mother and infant.

Clinical Research Facilities

These facilities cost between $400 and $625 per sq.ft., depending on the equipment and facilities needed for the space. Not all hospitals include clinical research facilities, but teaching and research hospitals usually have these areas. They may be located near laboratories, generally located on the north side of the building for better light control. Testing facilities and labs are usually part of this area, but the overall size and layout vary depending on the needs and use of the area.

Hospital Equipment Cost

The average cost of medical equipment in hospitals ranges from $300 to $400,000, depending on the equipment needed and other factors. Equipment plays a significant part in the total cost of the building project. The more specialized it is, the more each piece costs. Not every hospital requires the same amount or type of equipment. For example, hospitals in more rural areas sometimes need more equipment than hospitals in urban areas, which may specialize in an area and not require all available equipment.

In the table below, you’ll see a partial list of the most common equipment needed in a hospital, along with what each does and the average cost. Many hospitals need more than one of these pieces of equipment, and many departments need their own equipment. Some pieces of equipment are included in the overall cost of the project. However, many pieces are budgeted separately from the building of the hospital and are a separate cost that is incurred after construction is complete.

Cost of Medical Supplies

Supplies make up a large part of the regular costs of a hospital’s operation, with some hospitals spending up to $564,000,000 per year for supplies. Supply costs typically make up about 15% to 40% of all hospital expenses, which vary depending on the type of hospital, its location, and the number of beds. While supplies are not usually included in the cost of building the hospital, the hospital must be fully supplied and stocked before it can open and be operational. This includes medical supplies, doctor-preferred items, protective equipment for medical workers, office supplies, pharmaceuticals, and other miscellaneous items.

Hospital Architecture Design and Planning

It is estimated that design and consulting fees for this phase of the hospital build make up roughly 15% of the total cost of the project, meaning for a 300,000 sq.ft. hospital, around $16,875,000. Designing the hospital is a multistage process involving many people and specialists. Architects, engineers, and designers make up the bulk of the project from style, design, and structural views, but they often do not know or understand the needs of the actual hospital.

For this reason, it is becoming more commonplace for doctors and other hospital workers to collaborate on designs with architects and structural engineers to create better, more dynamic layouts. This can often help create more streamlined spaces, more efficient use of space, and a better overall layout that functions for caring for patients properly, efficiently, and with their safety and wellbeing in mind at all times. Several people are involved in this stage of the process, which takes a significant amount of time.

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Hospital Resilience

When discussing resiliency in hospitals, there are two separate considerations to make, including resiliency from outside factors, such as natural disasters, and internal resiliency, such as how well a hospital can handle a massive influx of patients like during a pandemic. In addition, they need to consider their ability to adapt to sudden increases in care. For example, most are encouraged to have empty lots nearby if they need to expand or build an additional wing. Paying close attention to the layout of the building to provide fast and efficient access is one way to ensure that care can be provided during high demand.

When constructing a hospital, care needs to be taken when considering the area and its climate. For example, hospitals built in regions prone to storms and flooding should put emergency generators on the roof or higher floor and position the important sections of the hospital during an emergency in higher areas. Hospitals constructed in locations prone to earthquakes, such as California, should be built to specifications and local building codes to reinforce them and ensure that they sustain as little damage as possible so that they can continue care. This will all be factored in during the planning stages.

Hospital Future Technology

Medical facilities and hospitals need to stay on the cutting edge of technology to do their jobs properly. Advancements are being made all the time, which means that the hospital needs to be flexible enough to update and change when needed. This may be why many older hospitals are renovated, with new sections added on, rather than simply building a completely new hospital. Doing this cuts costs and ensures that you are updating for future use and technology. Leaving some room for growth in your hospital layout and build site ensures that you can continue making upgrades as needed for the life of the building.

Additional Considerations and Costs

• Market attributes. The area that a hospital is built in can determine its total value. Markets with a lot of future development potential mean that the hospital will have greater value and demand higher costs for services. This may also impact construction costs.
• Patient outcomes and satisfaction. Many new hospitals are designed to accommodate patient satisfaction since most hospitals, especially those that rely on Medicare, often have costs tied to patient outcomes and satisfaction. Facilities that are flexible and designed to reduce overcrowding may have better reports than those that are not flexible.
• Reliance on technology. Hospitals are projected to become more complex in the future, which means a greater reliance on technology to design and build future hospital buildings. This reduces costs while increasing efficiency and patient satisfaction.
• Regulatory approvals. Hospitals are subject to not only building and safety codes but also regulations governing their use. All plans need to be submitted for approval to the appropriate authorities and organizations before building.
• Site. A hospital should be built in a quiet place on a healthy and flat site without dust, bad smells, or insects. The site should be large enough to accommodate future expansion.
• Renovate vs build. Many hospitals, particularly in rural areas, may be old buildings that are in disrepair or not up to current standards. These can often be turned into more efficient, economical, and eco-friendly buildings more easily than building new hospitals.