Amid demand for intensive neonatal care, VCU Health is underway on a project to expand its neonatal intensive care capacity with a new facility at its downtown children’s hospital.

The health system announced this week that it plans to open a new 20-bed neonatal intensive care unit at the Children’s Hospital of Richmond at VCU at 1000 E. Broad St.

Construction on the 28,000-square-foot NICU has kicked off, and the project is anticipated to cost under $28 million, VCU Health spokeswoman Kate Marino said.

The unit is taking shape on the fourth floor of the Children’s Tower, a relatively new addition to the children’s hospital. The NICU is planned to consist of 16 single rooms and a pair of twin rooms, which together would accommodate up to 20 patients.

The rooms are planned to have a sleeping space and bathroom for parents. The unit is also planned to have a lounge.

DPR Construction is the general contractor on the project and HKS Architects handled the design.

The new NICU is expected to open in January and would expand the pediatric hospital’s existing 40-bed NICU, which is housed in the VCU Medical Center Critical Care facility that’s also on the downtown medical campus.

The VCU Health children’s hospital is a Level 4 NICU, which is the highest level of care available for infants with critical medical needs, according to a news release. The hospital handles babies born at VCU Health and is a regional referral center. VCU Health says the hospital’s NICU sees high demand, which has motivated the expansion project.

“Our current NICU is continually at capacity, signifying that more space is required to serve babies in need of critical, innovative surgical and medical treatment that isn’t available at other hospitals,” Dr. Karen Hendricks-Muñoz, the hospital’s interim chief physician, said in a statement.

The project comes as part of expansion plans at the Children’s Tower that VCU Health unveiled last year. VCU Health is also planning to add 24 acute care pediatric beds in other shell space in the Children’s Tower.

The health system is in the process of securing regulatory approval for the surgical beds and has started preliminary design work for the unit they will occupy, Marino said. It hopes to have those beds available by December 2026.

The 16-story, 72-bed Children’s Tower opened in April 2023 . The $420 million project was added onto the Children’s Pavilion, an outpatient facility completed in 2016 on the same city block. Together, the two facilities make up the pediatric hospital.