Project requirement: $3,250,000 investment.

Finance: $1,600,000 on a non-recourse basis (no personal guarantees or personal collateral). $1,000,000 on a limited recourse basis (guarantees limited to each partner’s percentage interest).

Fund: $650,000 with partner equity contributions.

Individual facility contribution (for 10% ownership in the center): Equity of $65,000 (10% x
$650,000). Limited guarantee of $100,000 (10% x $1,000,000).

Typical cost breakdown (equipment, furnishings, supplies, and working capital reserves).
The total cost has four main components:

1. Architectural design ranges between $85,000 and $130,000. This includes obtaining state approvals and completion of the accreditation process.
2. Construction costs are approximately $125-$175 per square foot and the typical size is 7,000-8,000 SF (between $875,000 and $1,400,000). We contract for construction management and provide oversight of the project.
3. Equipment and furnishings generally cost between $800,000 and $2,000,000 depending on the medical specialties in the surgery facility.
4. A working capital reserve (“cash float”) of $600,000-$800,000 is required. These funds are necessary to pay regular operating expenses – rent, staff salaries, utilities, etc. – until facility fee collection is adequate (usually four months after beginning operation).

Total cost: Between $2,360,000 and $4,330,000.