University Health will purchase a two-story medical building in the South Texas Medical Center to be part of its new 45-acre Babcock Specialty Hospital campus.
The public hospital district’s board of managers unanimously approved the $5.2 million purchase on Tuesday during its regular monthly meeting. The board also approved an additional $8.3 million for renovations and equipment.
In July 2025, University Health entered into a deal with CHRISTUS Health to purchase its shuttered Santa Rosa Hospital in the medical center, along with the 45 acres surrounding the building. The goal is to move many of the nearby flagship hospital’s ambulatory services onto this campus to reduce patient congestion at University Hospital.
That land included five office buildings, whose tenants could remain and pay a ground lease to University Health. In January, University Health voted to enter into a $50 million deal to purchase two of those buildings, a seven-story and four-story office tower.
Now, the hospital system will expand its reach even more with the purchase of an additional building, this one a two-story, 27,000 square-foot office located at 5107 Medical Drive.
The current tenant, the Diabetes and Glandular Disease Clinic, will vacate the property by the end of the year.
University Health officials explained during the board meeting that they planned on renovating the building and housing several outpatient clinics there, including 14 women’s exam rooms, 12 pediatric exam rooms and 19 adult primary care exam rooms.
