Baptist Health has landed a $3.79 million city permit to renovate nearly 31,000 square feet inside a former Jacksonville shopping mall, turning the space into a Central Services Center packed with pathology offices, classrooms and workrooms for its own staff. The project marks phase one of a broader plan to convert the sprawling San Marco East Plaza campus into a hub for the health system's back-of-house operations.
The permit, issued by the City of Jacksonville on September 2, covers interior demolition and alterations inside Building D, a two-story structure totaling 100,872 square feet, according to Jacksonville Daily Record. Contractor Auld & White Constructors LLC will handle the buildout, improving almost 31,000 square feet within the building. The Jacksonville-based firm has operated in Northeast Florida for nearly 40 years and maintains a division specializing in healthcare construction and infection control, according to Auld & White Constructors.
Plans call for work on limited portions of both floors. First-floor work includes classrooms, storage, and dining and market space, while the second floor will house offices for pathologists, workrooms, and classroom, conference and office space. Jacksonville-based Kasper Architecture + Associates Inc. is the project architect, per the Daily Record's report. The Central Services Center will be used for back-of-house operations and support services for Baptist Health, and the newspaper reports it will not be accessible to the public — only to Baptist Health team members.
A Former Mall's Long Road to Medical Backbone
The San Marco East Plaza site at 3563 Philips Highway, at Emerson Street just west of Interstate 95, has a history stretching back decades before it became hospital infrastructure. Originally built in 1961 as Philips Highway Plaza, the property served as Jacksonville's first enclosed suburban shopping mall before being rebranded Market Square Mall and eventually converted into an office park, according to The Coastal. The 29.68-acre campus now comprises seven buildings with 375,752 square feet of combined interior space.
Baptist Health Properties Inc. had leased space at San Marco East Plaza for nearly 20 years before buying the property outright for $38 million in December 2025, purchasing it from Prescott Group of Dallas, which sold through an entity called PSF I JAX Metro LLC, per the Daily Record's reporting. The health system said the leased space had already demonstrated its value to operations, and described San Marco East as a versatile property for its work. As of the Daily Record's report, no plans had been announced for the plaza's remaining unoccupied buildings.
Executive Transition Shapes the Master Plan
Then-CEO Michael Mayo laid out some of the thinking behind the consolidation in January 2026, saying Baptist Health would evaluate the best and highest use of the property. Mayo said at the time the system was considering a centralized logistics center for its supply chain that could consolidate warehousing and shipping to Baptist Health facilities, and was also evaluating potential core laboratory operations and a possible commissary or centralized food distribution location, according to a Baptist Health statement sent by email in May 2026 and cited by the Daily Record.
Mayo has since retired from his executive role, transitioning into an advisory position through the end of 2026, according to CareerSource Northeast Florida. The Central Services Center permit follows an earlier city permit, issued in May 2026, for interior demolition and alteration of 54,000 square feet at the same campus, a $400,000 project. Existing space at the plaza has included the Players Center for Child Health at Wolfson Children's, business offices, and professional development and training space.
Training Center Already Anchors the Campus
The consolidation strategy is already visible elsewhere on the property. Baptist Health operates the Baptist Center for Professional Excellence at San Marco East, a 42,066-square-foot training facility that opened classroom space in October 2025 and a 13,000-square-foot simulation lab in July 2025. CareerSource Northeast Florida reports the $11.5 million facility's simulation lab is five times larger than the one it replaced, offering classes that exhibit medical conditions using fully equipped hospital rooms.
Baptist Health is one of Northeast Florida's largest private employers, with a regional workforce of more than 15,000 team members and 2,000 physicians spread across six hospital campuses and 17 urgent care centers, according to Jacksonville Today. That scale helps explain why the health system is pushing to centralize administrative, training and logistical functions rather than continuing to lease scattered office space around the city.
Expansion Elsewhere Puts Pressure on Support Infrastructure
The San Marco East buildout is unfolding as Baptist Health accelerates clinical growth across the metro area. The system broke ground in February 2025 on a new medical campus in the Seven Pines master-planned community, which previously reported by Hoodline was expected to open this spring. In April 2026, St. Johns County approved a $100,000 helipad permit for Baptist Health's forthcoming 33.6-acre Silverleaf medical campus, slated to begin seeing patients this fall.
Downtown, Baptist MD Anderson Cancer Center opened a dedicated 24-room cellular therapy and stem cell transplant inpatient floor inside Weaver Tower at Baptist Medical Center Jacksonville just days before the Central Services Center permit was issued. Each of these clinical additions increases the demand on pathology, logistics and training infrastructure — the very functions the new San Marco East center is designed to support.
Philips Highway Corridor Sees Broader Investment Surge
Baptist Health's real estate moves are part of a wider wave of commercial activity along the Philips Highway corridor. Mid-2026 saw a $17.15 million retail-industrial package trade in May, alongside a $5.5 million industrial campus acquisition by Jax Dirtworks, according to Hoodline's earlier coverage of the corridor. San Marco East Plaza itself remains a mixed-use campus, continuing to house third-party tenants including The Edge Rock Gym and Excel Church alongside Baptist Health's growing footprint, per the Jacksonville Daily Record.
What remains unclear is how Baptist Health plans to handle its remaining third-party leases on the property, which supply-chain or commissary functions might follow in future phases, and how the system's incoming leadership will carry out the long-term master plan now that Mayo has stepped back from his executive role. For now, the $3.79 million Central Services Center permit represents the most concrete step yet in transforming a decades-old shopping mall into the operational backbone of one of Northeast Florida's largest health systems.
