Noon Development's newest medical office project is taking place even as a number companies have employees work from home for the foreseeable future amid the coronavirus pandemic.
Officials of the Chattanooga-based company said that while some entities did hit the pause button during the pandemic, they believe interest is picking back up in new projects in the medical space.
"When it comes to the medical sector, most medical groups still want interaction," said Todd Phillips, president of the related private investment firm Noon Management. "We don't think there will be a long-term affect on medical space."
Noon plans to break ground this fall on a 25,500-square-foot medical office building. The two-level structure, which could grow larger by nearly 50% depending on demand, will be the first new building to go into the former Alstom site on Riverfront Parkway near the central city.
Renamed The Bend, a group led by Chattanooga developer Jimmy White is remaking that 112-acre site into a mixed-used development that ultimately could hold $2 billion to $3 billion in new investment.
"I think we'll see more office space at The Bend," said White, citing its proximity to downtown and the city's hospitals. "It's prime for medical office and lots of other uses."
Bob Elliott, Noon Development's president, said there's a growing need for new medical office space in the downtown market. Noon in 2018 completed an even bigger three-story medical office building nearby on Riverfront Parkway. It was sold in July for $13 million to Chicago-based MB Real Estate health group and the Boca Raton, Florida-based KA Real Estate.
"This area of Riverfront Parkway will bring hundreds of new residents and foot traffic to the area," Elliott said. "We're especially pleased that the team at The Bend saw the essential need to designate medical office space in their planned community."
The new building, named Riverfront Medical Center at The Bend, already has the first floor leased up as an ambulatory surgical center, said Phillips. He declined to immediately name the occupant or the project's cost.
With work starting this fall, officials expect the project to be ready in about a year.
"We're just starting to market the remaining" vacant space, Phillips said. He also likes the area's location due to its nearness to the highway system, giving tenant customers easy access.
"It has parking, " Phillips added. "It doesn't cost anything to customers in a downtown setting."
While Noon started in Chattanooga in 2013, involving former CBL & Associates Properties Inc. executive John Foy, the company is branching out into the South and other areas, the officials said.
"It really has blossomed from there," Phillips said.
Elliott said whether it's a health care or private provider, Noon officials are seeing a "hub and spoke approach" in the medical community to servicing people.
He said there's a central location and then entities are reaching out to different locations in cities, and he expects to see that trend continue.
Noon does other developments in addition to medical space, such as the revamp of the Fleetwood Building in downtown Chattanooga. But, Phillips said, the company's plate is "pretty full" now due to its relationships in the medical sector.
"That will be our concentration moving forward," he said. "We bring a retail background to medical space. That's been advantageous to our team."
White said that when it comes to the building of future office space, he disagrees with the thinking that much less will be needed due to the pandemic.
While many people will work from home, others will return to offices and they'll be socially distancing, which will require added space, he said.
"The net gain is still a positive," White said.
Contact Mike Pare at mpare@timesfreepress.com. Follow him on Twitter @MikePareTFP.