Thirty-three year-old GI Associates and Endoscopy Center is consolidating its Jackson and Flowood offices into a 75,000 square-foot building in Flowood’s Lakeland Marketplace North.
GI Associates has bought a standing 50,000 square-foot building that opened in 1972 as a Mississippi Fine Furniture Wholesale store and remained a home for various furniture retailers through 2009. The new owners will redo the building for clinic use and add an additional 25,000 square feet to the structure, said developer Daniel Hughes, who sold the center the building and slightly more than three-acre site on which it is situated.
When it opens in mid-2015, the center will be the principal facility for GI Associates, which has nearly two dozen physicians and about 300 other employees. The group says it will maintain its Madison and Vicksburg satellite offices.
Hughes, who also developed Brandon’s Palisades on the Rez luxury home community, said GI Associates’ decision to occupy and expand the former furniture store building at the corner of Lakeland Drive and Treetops Boulevard is a significant boost for efforts to create a medical corridor in and around the highly-trafficked intersection.
“That is the busiest intersection in the state,” Hughes said, and it is situated between two major hospital clusters, University of Mississippi Medical Center, St. Dominic and Baptist hospitals to the east and Woman’s Hospital at River Oaks and River Oaks Hospital to the west.
Hughes said he is counting on continuation of the medical migration to the Lakeland Drive-Treetops Boulevard corridor. He said he is sufficiently confident in its emergence as a corridor that he is buying adding parcels there. He is looking at about seven additional acres to add to an equal amount oif acreage he already has, he said.
The expected draw for medical investors: Ample parking and land on which to build and expand as needed, Hughes said.
“It is my sense that many of these practices have been in rented space in multi-story office buildings in downtown areas. And they want their own space with ground-floor parking.”
The conversion of the retail store to medical center use is part of a trend toward non-traditional tenants moving into retail space, said Ed Thomas, a Memphis-based Colliers broker who arranged the sale of the Lakeland Marketplace North site.
“Medical was definitely the highest and best use for the site,” he said.
Additional motivation for development of a Flowood medical corridor is coming from incentives offered through the state’s medical zone legislation, which developer Hughes noted figured into the GI Associates’ relocation decision.
Legislators adopted the incentives in the 2012 session as part of Gov. Phil Bryant’s economic development strategy. They provide an accelerated 10-year state income tax depreciation deduction and sales tax exemptions on equipment purchases from the time the medical business is certified through the first three months after completion of the facility.
The 2012 legislation also gives cities and counties the option of granting medical businesses certified for the corridor either a 10-year property tax “fee in lieu” or a 10-year ad valorem tax exemption. Flowood granted GI Associates incentives allowed by the medical corridor measure, according to Mayor Gary Rhodes.
“The city’s assistance in providing the incentives as provided for in the medical zone legislation is just another example of how business and government can work hand in hand,” he said in a press statement.
A key requirement is that the medical operation be within a five-mile radius of an acute care hospital of more than 375 beds.
To qualify, health care-related businesses must commit to create at least 25 full-time jobs and/or invest $10 million.
With its move into Marketplace North, GI Associates and Endoscopy Center will join the Crye Leike office building, and Ruby Tuesday and Crazy Ninja restaurants. An additional 3.8 acres next to the GI Associates property are available, according to Hughes.
“The addition of a large medical practice to our mix of of retail and office space give sus a nice balance in the development,” he said.
Dr. Ron Kotfila, GI Associates president, said the new center will allow “comprehensive,on-site and pediatric and adult services, significantly improving the patient experience.”