Former PeaceHealth Hospital Demolition Raises Safety, Traffic Concerns in Eugene

Asbestos removal work and initial demolition prep work unfolded in advance of the structural teardown at the former PeaceHealth Sacred Heart Medical Center, University District in Eugene. By the time PeaceHealth spokesperson Joseph Waltasti confirmed structural demolition of the hospital building would start Monday, March 23, an excavator had already been photographed working on the east side of the old hospital as early as March 19.

PeaceHealth relocated the hospital to Springfield and put its property up for sale in multiple parcels. Landmark Properties, a Georgia-based developer involved in the demolition work, intends to construct housing on part of the former hospital property. In a statement, a Landmark Properties spokesperson said, "The proposed project expects to deliver over the course of two phases. Phase one will include 272 units while phase two will include 325 units. Demolition work has commenced on site and is expected to be fully complete later this year."

The demolition is already reshaping daily life along Hilyard Street. The work requires traffic control along Hilyard Street between 13th Avenue and 11th Alley. Demolition work includes closure of the east sidewalk along Hilyard Street, with pedestrian traffic directed to the west sidewalk. The northbound bike lane is being temporarily relocated into the eastern travel lane and separated from vehicle traffic with a temporary barrier, Waltasti said. Vehicular travel lanes on Hilyard Street will stay open during this phase.

Those changes compound an already-tense traffic situation. A newly added bike lane with a reflective divider on Hilyard Street reduced the number of vehicle lanes available, making merging more difficult and generating reports of cars drifting into the bike lane. University of Oregon student Brandon Dobias described the cumulative effect plainly: "It definitely takes like a couple more minutes to get through. You know, all the noise that's coming from here is like I can hear it in my classes as well. So it's just a bit distracting."

The frustration runs deeper for those who remember the site as a working hospital. Shelly Teubner, a former Radiologic Technologist at PeaceHealth, did not hold back. "It's sad what's happening to Riverbend right now," Teubner said. "It's very unfortunate. We need our hospital here and to make it more student housing, I think, is just ridiculous." On the traffic question, Teubner was equally blunt: "Oh, something serious is going to happen again. Certainly. The drivers around here don't care. Everybody's out for themselves anymore. There's so many cars, so much traffic anymore."

PeaceHealth's Sacred Heart Medical Center on 13th Avenue closed in 2023 after "sizable financial losses and the need for large-scale renovations and seismic retrofitting to continue using the facility." Since PeaceHealth put the property up for sale in March 2025, different organizations have expressed interest in different parts of the real estate, which totals 1.2 million square feet on 12.53 acres.

Demolition of the hospital's ancillary building is set to start in late April, and Hilyard Street will be closed entirely to traffic during removal of skybridges over the street. The removal of all three skybridges is tentatively set for mid-May, Waltasti said. City records show permit applications were filed last year for interior demolition work, demolition of the entire building, and tree removal. The full scope of traffic-control measures, detour plans, and precise closure durations beyond the Hilyard Street corridor between 13th Avenue and 11th Alley has not yet been made public.