Kaiser Permanente topped out its Railyards Medical Center in downtown Sacramento on September 9, 2026, setting the final structural beam roughly eighteen months after construction began. The eight-story, 662,050-square-foot hospital anchors a campus, at a $1.5 billion construction cost, and it is scheduled to open in 2029 as one of California’s first all-electric hospitals, replacing Kaiser’s aging Morse Avenue facility.
A crane lifted the final beam, signed by Kaiser staff and local officials, into place over the hospital’s top floor as employees, city representatives and members of Congress looked on across the street. Jay Robinson, Kaiser Permanente’s senior vice president and area manager for Sacramento, called it “a renaissance period for Sacramento.” Denton Kelley, chief executive of LDK Ventures, the Railyards district’s master developer, and Rep. Doris Matsui both spoke to the moment’s significance for a skyline that has changed little in decades. Dr. Rick Vitangcol, Kaiser Sacramento’s physician-in-chief, joined the ceremony as well, marking a project he has said will let the health system consolidate services long split across the region into a single downtown campus. The ceremony echoed the health system’s own groundbreaking eighteen months earlier, when members of the Wilton Rancheria tribe led a land acknowledgment before construction began.
Eighteen Months From Groundbreaking to Steel
Kaiser broke ground on the 18-acre site at 365 Railyards Boulevard on March 19, 2025, pricing the project at more than $1 billion at the time. That figure has since grown: Tradeline’s April 2025 reporting put the construction cost at $1.5 billion, delivered by general contractor Hensel Phelps under a design from SmithGroup’s San Francisco office. Arup, Kimley-Horn and KPFF are handling structural and civil engineering, with Salas O’Brien providing security and life-safety design.
The hospital tower will hold 310 private beds, including a 48-bed intensive care unit and a 38-bed birthing center with an 8-bed neonatal intensive care unit, alongside a 70-bay emergency department and 14 operating rooms. It will also house Kaiser’s Advanced Neuroscience Center for stroke and spinal treatment. An attached five-story, 173,000-square-foot medical office building will add 66 exam rooms, a laboratory and imaging services, while a seven-story, 1,500-stall parking structure and a central utility plant round out the campus. The City of Sacramento cleared the project’s entitlements in a Notice of Determination filed December 13, 2024, roughly three months before groundbreaking, and that filing lists the site at just under 17.41 acres across four parcels on Railyards Boulevard and Summit Tunnel Avenue, with the hospital itself pegged at 657,500 square feet and 312 beds, figures that shifted slightly by the time Kaiser and its design team finalized construction documents.
Kaiser’s own project materials, compiled on its Railyards virtual tour site, put the scale of the build in more physical terms: roughly 947 miles of cabling, 100,000 cubic yards of concrete, 20 million pounds of structural steel, 17 million pounds of rebar and 4 million square feet of drywall across the campus, figures the health system has used to illustrate the scope of work completed in the eighteen months since groundbreaking.
A Statewide Seismic Mandate Behind the Rebuild
The Morse Avenue hospital it will replace does not meet the seismic performance standard California now requires. Under Senate Bill 1953, enforced by the state’s Department of Health Care Access and Information, every general acute care hospital building in California must remain operational after a major earthquake by January 1, 2030. Compliance is expensive statewide: a 2019 RAND Corporation estimate, cited in HCO News’ February 2025 coverage of the deadline, put the cost of bringing every California acute care hospital into line at up to $176 billion in 2025 dollars, with roughly 45 percent of hospitals still working toward the 2030 extension as of that report.
El Camino Health is rebuilding for the same reason, on a smaller scale eighty miles south. Its $1 billion, 340,000-square-foot replacement hospital in Los Gatos will add 122 single-occupancy rooms and target a 2032 opening, also as an all-electric facility, after the Town of Los Gatos received the application in June 2026. Measured per bed, the two projects land in different places: El Camino’s budget works out to roughly $8.2 million per bed across its 122 rooms, while Kaiser’s larger campus comes to closer to $4.8 million per bed across 310 rooms, a gap that reflects how much of Kaiser’s $1.5 billion also covers its attached medical office building, parking structure and utility plant rather than the hospital alone.
Kaiser has run this playbook before. Its Oakland Medical Center topped out in July 2011 under the same seismic mandate, a 12-story, 349-bed tower designed by NBBJ and built by McCarthy Building Companies that opened in 2014. Fifteen years later, the health system is midway through a second wave of replacements: a roughly 650,000-square-foot, all-electric sister hospital is under construction in San Jose on the same 2029 timeline, more than doubling that campus’s current size.
The Road to a 2029 Opening
What remains after topping out is largely interior work: mechanical, electrical and plumbing systems, medical equipment installation and commissioning ahead of the 2029 opening date cited consistently since groundbreaking. Kaiser has not disclosed how the $1.5 billion is being financed, and one major question still sits outside the construction schedule entirely. The future of the Morse Avenue campus, which has served the region for more than 60 years, remains unresolved; Kaiser says it expects to settle on a strategy for the site within the next 18 to 24 months.
The jobs case for the project is more settled. Kaiser expects the finished campus to employ close to 3,000 healthcare and support workers, with up to 600 union construction workers on-site during peak building, according to the Sacramento Business Journal’s groundbreaking coverage. The health system says it is on track to surpass one million members across the Greater Sacramento region within five years, a growth curve it points to in justifying a hospital nearly triple the bed count of a typical single-site replacement.
Anchoring a Changing Railyards District
The hospital is rising alongside the rest of a 244-acre district that sat largely vacant after railroad operators withdrew in the 1990s and years of environmental cleanup followed. To the south, work is underway on retail and entertainment space inside the former Central Shops buildings, including a planned 3,600-seat concert venue that LDK Ventures says will outdraw Sacramento’s 2,150-seat Channel 24 in midtown. Nearby, Sacramento Republic FC’s $321 million stadium, expandable to 20,000 seats, broke ground in the summer of 2025 and is tracking toward a 2027 opening. Hensel Phelps, Kaiser’s contractor here, is also building a zero-net-energy, zero-net-carbon office complex on Richards Boulevard in Sacramento’s neighboring River District, giving the firm a hand in two of the city’s largest sustainability-driven developments at once.
For a district that emptied out three decades ago, the hospital’s rising steel frame has become one of the more visible signs that Sacramento’s downtown core is filling back in, with the medical center, the stadium and the surrounding retail work all converging toward completion between 2027 and 2029.
Project Fact Sheet
- Project Name: Kaiser Permanente Railyards Medical Center
- Location: 365 Railyards Boulevard, Sacramento, California
- Project Value: $1.5 billion (Tradeline Inc., April 2025); initially cited at more than $1 billion at groundbreaking (Sacramento Business Journal, March 2025)
- Client/Owner: Kaiser Foundation Health Plan, Inc. (Kaiser Permanente)
- Main Contractor: Hensel Phelps
- Architect: SmithGroup (San Francisco)
- Key Components: Eight-story, 662,050-square-foot hospital (310 beds, 48-bed ICU, 38-bed birthing center with 8-bed NICU, 70-bay emergency department, 14 operating rooms, Advanced Neuroscience Center); five-story, 173,000-square-foot medical office building (66 exam rooms); seven-story, 1,500-stall parking structure; central utility plant
- Site Area: 18 acres (17.41 acres per the city’s entitlement filing)
- Construction Start: March 19, 2025
- Expected Completion: 2029
- Jobs Created: Approximately 3,000 healthcare and support positions at full operation; up to 600 construction workers on-site during peak building
- Environmental Features: Designed as one of California’s first all-electric hospitals, with rooftop solar, EV charging stations and drought-tolerant landscaping
Project Team
- Owner: Kaiser Foundation Health Plan, Inc. (Kaiser Permanente)
- Master Developer, Railyards District: LDK Ventures
- Architect: SmithGroup
- General Contractor: Hensel Phelps
- Structural and Civil Engineering: Arup, Kimley-Horn, KPFF
- Security and Life-Safety Engineering: Salas O’Brien
- Entitlement Authority: City of Sacramento
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