Redevelopment of the vacant Naval Hospital will serve as a catalyst to revive the fortunes of the Chicora-Cherokee neighborhood, which has suffered since the Navy shipyard was shuttered, North Charleston Mayor Keith Summey said Friday.

"It's the tallest building in North Charleston," he said.

The private owners of the hospital said at a press conference that they have leased about 25 percent of 400,000 square feet of usable space in the 10-story structure.

The first tenants beginning next year will be Charleston County services, including primary offices of the health department, substance abuse services and the coroner. Fetter Health Care Network will also be a tenant.

Summey predicted that in 20 years the changes at the hospital that are happening now will be seen as the key that unlocked a new future for Chicora-Cherokee, where today there are many boarded-up houses and a big vacant school. He envisioned an influx of workers, new restaurants and retail.

A real estate expert who teaches at the College of Charleston said the hospital plan is a step in the right direction.

"There's nothing worse than a big, old empty building to bring an area down. Bring some foot traffic and you've got some life," said Elaine Worzala, a professor in the school of business and economics.

People working at the hospital and those seeking services there can create a supply of consumers for business, such as a new restaurant, she said.

"Because it's focused on social services, it's not going to be a Charleston Place," she said. "But it can certainly work. The likelihood of a lot of money coming in is pretty small, but they're coming there and they are spending."

Key county social services will be centralized in one location at the hospital on Rivers Avenue, which is the busiest route on the CARTA bus system.

The county has leased 58,540 square feet on the first, second and eighth floors of the building for its Department of Alcohol and Other Drug Abuse Services. The health department will occupy 28,360 square feet on the first floor. Those services are currently located in buildings on peninsular Charleston that the county is selling to the Medical University for about $17 million.

Under the lease, the county pays $12.50 per square foot per year. The hospital landlord will pay for a $1.6 million renovation of the space. The county will cover its moving costs and installation of voice and data networks, officials have said.

Leases with other tenants are pending. They include dental services, dialysis and infusion, pharmacy and the Charleston Mental Health Center. Transitional housing and a day care and learning center may occupy the building, according to developers Chicora Gardens Holdings LLC.

Discussions are underway with other possible tenants that would provide unidentified state and federal services.

A grocery store and banking are possibilities, the developers said.

The project is called Chicora Life Center.

Reach Prentiss Findlay at 937-5711.