FEASIBILITY ASSESSMENT FOR VIEW ROYAL PRIMARY CARE ATTACHMENT CLINIC

COMMITTEE OF THE WHOLE REPORT

TO: Committee of the Whole FROM: Scott Sommerville, CAO DATE: July 9, 2026 MEETING DATE: July 14, 2026

FEASIBILITY ASSESSMENT FOR VIEW ROYAL PRIMARY CARE ATTACHMENT CLINIC

RECOMMENDATION:

THAT staff seek legal support on developing a draft Partnering Agreement with a non profit society that ensures patient attachment for View Royal residents and protects any investment made by the Town into renovating a clinic.

ALTERNATIVE OPTIONS:

1. THAT Council defer the decision on providing a health care clinic for residents until a suitable grant program can be identified by staff to fund leasehold improvements.
2. THAT Council defer the decision on committing to leasing space until a location has been finalized and leasehold improvement costs have been estimated.

PURPOSE:

The purpose of this report is to provide Council with a feasibility assessment on health care provision in response to two 2026 council resolutions.

BACKGROUND:

At the January 20th, 2026 Regular Meeting of Council, the following resolution was passed:

“THAT the Mayor and Chief Administrative Officer be authorized to continue discussions with health care providers, property owners, and Island Health, and to report back to council with updates and any proposals intended to increase primary health care coverage for the residents of View Royal.”

At the June 2nd, 2026 Regular Meeting of Council, the following resolution was passed:

“THAT staff work with representatives from Aroga Lifestyle Medicine and other relevant partners to undertake a detailed feasibility assessment for a View Royal Community Primary Care Attachment Clinic, including preparation of a Class C cost estimate for the purpose of a grant application, governance review, partnership analysis, funding strategy, and report back to Council with findings and recommendations.”

OBJECTIVE:

The objectives of opening a View Royal Community Primary Care Attachment Clinic is to ensure that View Royal residents who are currently unattached to a primary care provider have an opportunity for medical care.

MARKET ANALYSIS:

Demographic Analysis:

View Royal has experienced significant population growth, growing from 10,408 (2016) to 11,475 (2021) according to the most recent census. According to the 2021 census, 20.9% of View Royal residents are over 65 years, or approximately 2400 residents. The census also showed that 1.9% of View Royal residents are over 85 years, or approximately 220 residents.

With View Royals’ 2026 population estimated to be 12,782 residents (BC Stats), View Royal likely has 2,670 residents over the age of 65, and 240 residents over the age of 85.

It is projected that View Royal’s population will reach 13,714 by 2031, growing by an average of 186 residents per year (BC Stats).

Health Care Demand:

In mid-May 2026, the Town urged residents to register for the BC Health Connect Registry if they were unattached to a family doctor or nurse practitioner. Aroga estimates that approximately 4,500 (or 35%) of View Royal residents are currently unattached to primary care.

Currently, unattached View Royal residents may be reliant on emergency room visits, urgent or primary care centres throughout the South Island, or calling HealthLink BC at 8-1-1.

Aroga intends to prioritize primary care attachment to seniors, the medically-vulnerable, Canadian Armed Forces families residing in View Royal, and first responders.

Location and Accessibility:

The proposed location of the View Royal Primary Care Attachment Clinic at Eagle Creek Village is advantageous. There is ample parking, and the Clinic would be near the Island Surgical Centre and Forbes Pharmacy. The location is also in close proximity to Victoria General Hospital, creating a health care cluster near to one of View Royal’s most densely populated neighbourhoods.

Aroga has identified three potential spaces in the Eagle Creek Village Complex:

1. Sharing 2,500 ft2 of the 8,000 ft2 of the 2nd floor (previously Great western Financial office)
2. Sub-leasing Aroga’s existing 2,700 ft2 space on the first floor
3. Leasing space elsewhere in Eagle Creek Village

At the time of publication of this report, the final location has not been identified. Aroga is hoping to get a financial commitment for lease space from the Town of View Royal by the end of August 2026.

Aroga Lifestyle Medicine – The Proponent

Mayor Tobias has held discussions with Aroga Lifestyle Medicine (“Aroga”), a for-profit healthcare organization founded in 2017. Aroga currently operates in 7 cities across Canada and serves over 80,000 patients. Aroga is working with the City of Colwood on the Colwood Clinic, providing healthcare to Colwood residents.

Aroga’s proposes to create a non-profit society and to provide:

• 8 exam rooms in 2500 ft2 in their expansion of their clinic into the approximately 8,000ft2 second floor at Eagle Creek Village,
• primary healthcare for View Royal residents not currently attached to a physician or nurse-practitioner.
• physicians and nurse practitioners would be compensated via the provincial billing process, not through the municipal payroll.

Aroga proposes patient attachment for View Royal residents as follows:

FINANCIAL IMPLICATIONS:

Based on the presentation by Aroga Lifestyle Medicine CEO Lorne Friesen at the June 2nd, 2026 Regular Meeting of Council, costs were estimated as follows:

Start-Up Costs

Aroga plans to lease the 8,000 ft2 second floor above their current leased space, and to set aside 2,500 ft2 on the second floor for the purposes of the View Royal Primary Care Attachment Clinic. Requirements to retrofit the space are contained within Appendix D - Technical Requirements Outline for a Medical Clinic.

Aroga estimates the cost of the leasehold improvements as follows:

Capital Investment:

• Improvements and Build-out @ $225/ft2 for 2500 ft2 = $562,500
• Equipment and furnishings for 8 exam rooms and waiting room = $190,000
• Legal and startup costs = $25,000
• Total = $777,500

Staff have made inquiries about conducting a Class C estimate for the purposes of a grant application, but details are currently lacking to complete that estimate.

Operating Costs:

Aroga originally estimated the annual lease cost for the 2500 ft2 2nd floor space at $110,000-$130,000/year.

The Town would be responsible for a portion of administrative costs for the receptionists, and for a portion of costs related to the provision of washrooms and a lunchroom for medical staff.

Funding Strategy:

The Direct Delivery stream of the federal Building Communities Strong Fund (the “Fund”) had been identified as a potential source of capital funds for a View Royal Primary Care Attachment Clinic project.

Since the meeting on June 2nd, 2026, Mayor Tobias informed staff that this grant would not be appropriate for the clinic project. Staff will continue to look for a grant program to offset the $777,500 cost of renovating a clinic space.

Yet to be determined is the source of funding for the renovations and lease costs. Accumulated surplus could be used to fund the renovations,

This grant opportunity requires a shovel-ready project that must be able to start within 12 months of submitting a grant application, and that construction has not started yet. The Fund can be used for large building retrofits and community health infrastructure.

The Fund application requires a Class C estimate (+/- 15%), which will require a higher level of detail. Staff await details of Aroga’s plans for 8 exam rooms in the 2500 ft2 space before we decide on using a quantity surveyor or an architect to develop the Class C estimate.

The Town will need to protect a $875,000 investment in the leasehold improvements, in the event that the Clinic ceases to provide service to View Royal residents for any reason. Potential risks to the provision of medical care include: shortage of healthcare professionals and potential of insolvency of the created non-profit society.

B. Financial Projections

Determine economic viability:

• Startup Costs: Facility lease/purchase, equipment, licensing, renovations.
• Operating Costs: Staff salaries, utilities, consumables, insurance.
• Revenue Projection: Patient volumes, service pricing, payer mix.
• Break-Even Analysis: Estimate volume thresholds for financial sustainability.
• Funding & Investment Structure: Equity, debt, grants, partnerships.

F. Risk Assessment

Identify potential obstacles:

• Market fluctuations, policy/legislation changes.
• Economic conditions affecting patient affordability.
• Competition and referral networks.
• Operational risks including staffing shortages and technology failures.

GOVERNANCE IMPLICATIONS:

While heath care is traditionally considered a Provincial responsibility, many neighbouring municipalities have launched initiatives to supplement healthcare for their residents. The Town has encouraged residents to register with BC’s Health Connect Registry to connect with primary care providers.

Aroga is proposing establishing an independent non-profit society under the BC Societies Act to provide medical services to View Royal residents, with municipal representation on the community board.

A partnership structure could be established through a Partnering Agreement under Section 21 of the Community Charter. A partnering agreement (also known as a P3 or public-private partnership) is a contractual tool to provide a municipal service through a third party.

A partnering agreement to provide medical care for View Royal residents would allow the Town to provide assistance beyond the traditional permissive tax exemptions.

Assistance under a partnering agreement requires public notice (according to Section 94 of the Community Charter) of the Town’s intention to provide assistance to an organization, as well as the nature, term and extent of the proposed service.

PUBLIC PARTICIPATION GOAL:

The desired level of public participation for the recommended option is:

☐ Inform ☐ Consult ☐ Involve ☐ Collaborate ☐ Empower ☒ N/A

TIME CRITICAL:

Aroga hopes to have a commitment to lease space before the end of August 2026.

ATTACHMENTS:

APPENDIX A – DRAFT SOCIETY CONSTITUTION APPENDIX B - DRAFT FOUNDING GOVERNANCE CHARTER APPENDIX C - DRAFT INITIAL PARTNERSHIP STRUCTURE APPENDIX D - TECHNICAL REQUIREMENTS OUTLINE FOR A MEDICAL CLINIC APPENDIX E – VIEW ROYAL COMMUNITY PRIMARY CARE ATTACHMENT CLINIC CONCEPT PAPER FOR DISCUSSION - June 2nd, 2026 APPENDIX F – STATUTORY REQUIREMENTS FOR PARTNERING AGREEMENTS: A MUNICIPAL GUIDE