The University of Minnesota and Fairview Health Services began construction last week on their first joint investment, a $160.5 million, 330,000-square-foot Ambulatory Care Center.

The Board of Regents discussed plans for the Ambulatory Care Center for at least 12 years but gave final approval in December, said Chair Richard Beeson.

“More planning turns into better buildings and better uses and efficiencies,” he said. “It’s an important building. It’s the next in the series of major investments we’re making to our academic health center with our Fairview partner.”

The new center will provide more space for patient care, team health care performance and research clinics, said University of Minnesota Physicians CEO Dr. Bobbi Daniels.

“[The Ambulatory Care Center] provides a facility that allows us to practice cutting-edge medicine and to do it in a very team-based environment. And that is key to educating the next generation of physicians, pharmacists, nurses, dentists,” said Dr. Aaron Friedman, outgoing dean of the Medical School and vice president for health sciences.

The research clinics are currently located in the Phillips Wangensteen building, which was designed half a century ago. The building lacks the necessary space and hasn’t been able to keep up with changes in health care, Daniels said.

“In order for us to preserve what we have going forward and to meet the needs of future health care providers for the state of Minnesota and to meet the challenges of health care reform, we had to do something now,” she said.

A newer, more technologically advanced environment will allow the University to remain on par with its statewide and national competitors, which could improve recruitment of new employees, Friedman said.

The current building’s location is problematic. Situated in the heart of campus near the Superblock, the combination of student, patient and city traffic causes serious congestion, Daniels said.

And for the extremely sick patients who are treated there — like those in the bone marrow transplant clinic — the hard-to-find site and lack of parking aren’t ideal.

“Where [the Phillips Wangensteen building] is geographically on campus is no longer an acceptable spot,” Friedman said. “It’s too hard to get to … so we just had to move to a place that patients could get to in a timely fashion.”

After the clinics move into the Ambulatory Care Center, the Phillips Wangensteen building will be repurposed for either classroom or office space, Friedman said.

The new Ambulatory Care Center will have onsite parking and will be located at 909 Fulton St. SE off Interstate 94.

Construction will happen within the next year, and the University will begin moving clinics in 2015. This is a “choreographed process” in which every item’s move is planned so as not to disturb the patients, Friedman said.

The center is scheduled to open in January 2016.

Daniels said students and physicians can look forward to less traffic congestion, a better environment for medical education, state-of-the-art technology for research and better preparation for medical careers.

“I think students’ experience at any college is elevated when the culture of excellence and accomplishment is widespread and there’s a certain amount of pride,” she said. “That might be most obvious when the football team is doing well, but when any other part of the University is doing well, that’s really important for students …”