Essentia Health reaches agreement with Virginia to buy clinic building

VIRGINIA — Essentia Health will have full ownership of its Virginia campus in just a few years, under a new agreement with the city.

After a year of negotiations, the Virginia City Council approved the agreement with Essentia on May 27.

The health care organization leases its clinic from the city. Essentia will pay the city’s remaining bond obligation. When that’s paid off in 2029, the city will transfer ownership of the clinic building to Essentia.

There’s also a land-purchase option for the acreage bordering the campus.

The city sold the hospital to Essentia in 2022. Essentia had been leasing it, as well.

While ownership is still a few years out, Essentia will make an $8 million repair to an exterior defect that’s caused water leaks now.

Sam Stone, Essentia Health-Virginia administrator, said it will take a few years to make that fix.

The agreement is reassuring amid uncertainties in rural health care, like rising costs and stagnant federal reimbursement rates, and because Essentia is the city's largest employer.

“It provides a lot of security in knowing what the future holds there," Stone said. "And I think the city wanted that, Essentia wanted that, the communities want that sense of security.”

Stone said the agreement is important, "and I think we’re all looking forward to moving on to more important things.”