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Morgan Hill
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February 24, 2020

Housing part of hospital plan

City planners, neighbors question proposed 200 units

A medical campus proposed on Juan Hernandez Drive received praise from the Morgan Hill Planning Commission on Jan. 28, but the 200 apartment units that are also part of the project drew concern from commissioners and neighbors.

Lillian Commons LLC is proposing a 100,000-square-foot, 55-bed hospital with medical office space, a 10,000-square-foot cancer center, a 4,500-square-foot urgent care facility and 10,000 square feet of commercial retail space, which could be a restaurant. Conceptual plans also show 200 apartment units adjacent to the medical campus spread out across five buildings that range from three to four stories tall. A park is also envisioned, as well as a three-story parking garage.

The meeting was only a preliminary review of early conceptual plans, with possible consideration by the commission and city council to take place at an undetermined date. Michael Groves of EMC Planning Group said preparing environmental review documents is the next stage in the process. The project would require a zoning change from commercial to mixed use flex.

The project is proposed for a four-acre property adjacent to a medical office facility at 16130 Juan Hernandez Drive, between Tennant and Barrett avenues, that is home to Advanced Orthopaedics, Camino Ear, Nose & Throat Clinic, Morgan Hill Imaging and South Valley Neurology.

Cecily Murray of Lillian Commons LLC is currently in the process of purchasing the property from the Health Trust of San Jose.

An operator for the hospital is currently unknown, as Murray said she is under nondisclosure agreements.

“We have several large hospital systems that are looking at this space and that are interested in this space,” she said. “They feel very strongly, especially with the county having moved into St. Louise [Regional Hospital in Gilroy] and O’Connor [Hospital in San Jose] that there is a need for a private hospital in this area.”

Aaron Scott, who said he lives near the proposed project site, agreed that Morgan Hill needs more medical facilities, but pointed to the presentation by EMC Planning Group that stated there would be no “substantial adverse effects on surrounding properties.”

“Adverse effects, substantial or not, are adverse,” he said. “What does that mean? What do they anticipate those to be?”

Juan Hernandez Drive residents Laura and Jeff Salem spoke to the commission about the increased traffic on their street in recent years, and expressed concern about how such a project would affect student drop-off and pick-up at nearby Barrett Elementary School.

“It’s very bad in the mornings; it’s very bad in the afternoons,” Jeff Salem said. “The school is getting more crowded as it is, and the traffic gets worse and worse every year.”

Commissioner Liam Downey said the medical campus “ticks all the boxes” when it comes to benefiting the community. But he said he understood from Groves’ presentation that the only reason the housing component is part of the project is “purely financial.”

“For years we’ve always intended to not have residential on the freeway,” Downey said. “That’s for a reason. I’m not sure people would even want to live there. You’re going to have to find some other way to make it pencil out than putting housing there.”

Commissioner Malisha Kumar said the medical facilities are needed, but the density and size of the apartment buildings are a concern.

“It doesn’t really mesh with the neighborhood,” she said.

Should the project be approved by the city in the future, Lillian Commons LLC would have to secure approval from various state agencies, including the Office of Statewide Health Planning and Development Facilities Development Division for building permits. According to the California Health Care Foundation, it typically takes seven to eight years for hospital facilities to go from the conceptual phase to construction.

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