Beebe drops plans for Milton campus

MILTON — Beebe Healthcare’s plans for a Milton campus were put on pause, as the development group tasked with constructing the building withdrew its application for the project last week.

Earlier this year, Phoenix RHCS Holdings announced a partnership with Beebe on a new campus, tentatively called the Jerry Ann McLamb Medical Pavilion, on 8 acres in downtown Milton. Early plans showed two 40,000-square-foot offices, one of which to be leased to Beebe and the other would have been used for complementary medical services.

In January, Beebe’s then-interim president and CEO Rick Schaffner told the Delaware State News that the Milton campus would provide primary care, walk-in care, as well as diagnostic imaging, laboratory services and rehabilitation services. 

The office would have been Beebe’s most northern location, continuing a string of recent expansions through Sussex County. This spring, Beebe opened a freestanding emergency department and a cancer center at the Beebe South Coastal Health Campus. Construction work is underway at Beebe’s $124 million surgical hospital on Route 24 near Rehoboth Beach with a target opening in 2022.

The pavilion would have honored McLamb, a Milton native and a dedicated nurse that graduated from Beebe School of Nursing and spent most of her 50-year career at the southern Delaware health system. McLamb, who died in 2018, is the mother-in-law of Phoenix RHCS Holdings chief financial officer Chris Selzer.

The proposal would have also marked a first in Sussex for Phoenix RHCS Holdings, as it has previously developed medical offices in Southeastern Pennsylvania and New Castle County. Most notably, the company developed the Apex Medical Center with its memorable doctor’s bag sculpture in Christiana, according to a company representative.

All five parcels are owned by Lobolly, LLC,  the property management division of Draper Holdings, which owns the WBOC television station. Phoenix RHCS Holdings planned to buy the property from Lobolly, according to a Cape Gazette report, but the land has not changed hands as of Sept. 28.

Phoenix RHCS Holdings sought to rezone five parcels from Mulberry and Reed streets from single-family residential use (R-1) to commercial and business use (C-1) to pave the way for the medical campus. But the Milton Planning and Zoning Commission voted not to recommend the rezoning, citing potential traffic issues – and the Delaware Department of Transportation yet to review the traffic impact  – and conflict with the neighborhood’s character.

The project could still have proceeded with a majority vote from the Milton Town Council. The public hearing on the project was postponed three times this summer on behalf of Phoenix RCHS Holdings, however, and it was ultimately withdrawn completely.

When contacted by the Delaware Business Times, John Paradee, the attorney representing Phoenix RCHS Holdings, had no comment. Now-Beebe President and CEO Dr. David Tam had no comment on the rezoning application or Beebe’s plans moving forward with a potential Milton Campus.

“We remain committed to serving the entire Sussex County community, including our neighbors in Milton, through our many physician practices, walk-in care locations, emergency departments and outpatient lab and imaging locations,” Tam told the Delaware Business Times in an email.

By Katie Tabeling

ktabeling@delawarebusinesstimes.com

Editor’s note: a previous version of this story incorrectly stated that that DelDOT found little traffic impact on this project. DelDOT had not issued any statement on the traffic impact.