Sutter Health has announced it will no longer be building a planned new hospital campus in Emeryville, but a new hospital in the East Bay is likely still in the cards.The $1 billion Sutter Health medical center that was announced in February 2025, to be located less than a mile north of the IKEA sto re in Emeryville, is no longer happening, the healthcare company says. The reason as the Chronicle reports, is worries about CEQA review and the potential for environmental litigation over the site.Citing a "lack of a clear and predictable regulatory path," Sutter leadership says they are abandoning the project. The decision comes two months after a bill before the California legislature was amended to remove the City of Emeryville from its original language, which had been originally intended to bypass CEQA review for Sutter hospital projects in both Santa Clara and Emeryville. As amended, the bill, AB 2231, passed in late September with only the city of Santa Clara specified in it — for reasons that haven't been made public.As the Chronicle notes, state Senator Jesse Arreguín, the former mayor of Berkeley, had sponsored an earlier bill that was specifically aimed at carving out a CEQA exception for the Emeryville hospital project, but that bill was shelved after Arreguín's office learned that Sutter wanted to add another city, Santa Clara, to the bill.In a joint statement, Sutter Health President and CEO Warner Thomas and Vice President and Chief Operating Officer Christina Oh said, "We remain committed to building a new hospital in the East Bay and are evaluating potential sites that can support emergency care, advanced clinical services and the region’s future needs."The urgency comes as Alta Bates Summit Medical Center in Berkeley has been set to close in 2030 due to earthquake safety concerns. It sounds as though Alta Bates may stay operational a bit longer now, as Sutter says that it is pursuing legislation to allow Alta Bates to remain open while a new hospital is planned and built — a process that will likely take more than three or four years.The Emeryville site, at Horton and 53rd streets, was just two and a half miles from Alta Bates, and it includes two existing buildings that Sutter already owns, which are still intended to become outpatient services hubs.Without Alta Bates, the Berkeley-Emeryville-Albany area would be without a full-service hospital, though Kaiser does have a large hospital campus about three miles east in Oakland. Groundbreaking for Sutter's Santa Clara hospital is scheduled for next year. The original timeline for the Emeryville project had the first patients being served there in 2028, with full completion of the hospital in 2033.Sutter has not commented further or indicated what other sites they may be considering in the East Bay.Previously: Sutter Health Announces a New Billion-Dollar Medical Center In the Middle of Emeryville ...read more read less