The UC Board of Regents approved a $298.2 million budget Wednesday to convert a Los Angeles building into a UCLA Health complex.

The project will convert an office building in El Segundo into UCLA Health South Bay, which will house a Sports Medicine Institute and create community fill and specialty pharmacies. The complex will also include the relocated UCLA Clinical Microbiology Laboratory, which is currently in Brentwood. 

The board discussed the project at its bimonthly meeting Tuesday and Wednesday at UC San Francisco.

UCLA bought the property in October 2024, and the board approved a $6.5 million allocation in January 2025 for preliminary planning pulled from hospital reserves. Construction is set to begin in January 2027 and has an anticipated completion date of June 2028. 

Peter Hendrickson, the associate vice chancellor of design and construction for UCLA Capital Programs, said renovations will focus on reconfiguring the building’s interior for the proposed facilities. He added that the facility will also include ambulatory surgery and physical therapy centersadd.

“By uniting specialists in sports medicine, orthopedics, radiology, anesthesiology, and physical therapy in the same facility, it will provide complete care for musculoskeletal needs,” the action item said. “This expansion will improve access to orthopedic services in an outpatient setting, relieving demand at UCLA’s Santa Monica and Ronald Reagan Medical Centers.”

The project’s $298.2 million budget will consist of $293.2 million in external financing supported by the UCLA Health system’s revenues. UCOP will provide the project with a $5 million grant from the University’s biomethane funds to counteract the use of fossil natural gas, promoting decarbonization. 

The newly-renovated building is intended to be all-electric, according to the agenda item.

The UC determined the project will not have significant environmental impacts – something it must report in accordance with the California Environmental Quality Act.

“This project is an important opportunity for UCLA Health to build on its long and successful history of caring for Angelenos,” the action item said. “The well-being of UCLA Health communities depends on addressing UCLA Health’s capacity constraints and expanding community-based resources to support both community health and surgical services.”