In the shadow of Northeast Georgia Medical Center, crews are clearing land for a new medical park that could add up to 135,000 square feet of office space to Gainesville's medical mile.

Parkway Professional Center is the first large-scale private medical development near the hospital since the recession began. Those backing it believe it's a sign of recovery on the horizon.

"Will this generate more activity? We believe that it will because we can see the demand that would support the building," said George Hokayem, managing director for Sperry Van Ness, the real estate company representing the project.

"And we think it will continue to accelerate the development as this one comes out of the ground."
The last large-scale private medical developments near the hospital were the final addition to the Medical Arts campus, completed in 2004, and Guilford Clinics, completed in 2006.

Hokayem said there were many similar projects being discussed before the recession, but Parkway is the first to come off the drawing board.

But local real estate expert Frank Norton Jr. said it's too early to know if this development will inspire others like it.

While economic improvements could spur growth, he said, many in the medical industry are waiting to expand until they better understand the effects of recent health care reform.

"Many of the medical practitioners are holding off on their plans," he said. "... They're handling their current, short-term needs, but not necessarily long-term commitments."

While private development near the hospital has stalled, the medical industry in Hall County has continued to expand, with projects such as River Place in Braselton, the hospital's recently approved campus in South Hall and health care company ProCare Rx's new facility being built on Candler Road.

Experts say that doctors, too, have continued to come to Gainesville. But they've changed where they are practicing.

"A number of doctors were moving in with either Northeast Georgia Medical Center or one of the other existing medical clinics like Longstreet or Guilford," said Tim Evans, vice president of economic development for the Greater Hall Chamber of Commerce. "So that created a change in the demand for medical office space in the community."

Karen Baston, medical specialist for Sperry Van Ness, said she is seeing that demand return. Physicians want to expand their practices in Gainesville, she said, and many put high importance on being near the hospital.

"They need to be as close to the hospital as possible in order for exposure and to try to get into the community," she said.

But office space on Jesse Jewell Parkway is scarce, she said.

Both the Medical Arts campus and Guilford Clinics are at full capacity.

"You do get the (physicians) who come in and say, ‘I need 8,000 square feet' or ‘I need 10,00 square feet,'" Baston said. "And right now in the Gainesville market you're not going to find that ... especially within an earshot of the hospital."

Baston said she is currently in discussions with possible tenants from both Georgia and outside of the state.

Parkway is being funded by Dr. Jeffrey Payne of North Georgia Eye Clinic and Laser Center, who plans to combine his surgery center and physicians offices there. Payne purchased the land in 2008 but waited to build there until the economy picked up.

The campus will encompass two 67,500 square foot buildings. The first, which broke ground in late November, is slated for completion in fall 2011. There are no immediate plans to start on the second building and Payne said that will be considered once the first is fully leased.

Evans said as the hospital continues to grow as a medical hub in Northeast Georgia, the community around it will grow with it.

"We've seen some changes in the medical office development and there was a slowdown for a while in the medical market," Evans said. "... The timing may be right for this project."