The $8.9 million project will add 12 beds at WakeMed's main Raleigh campus, giving it 48 neonatal intensive care beds.

But a similar expansion proposed by WakeMed's crosstown rival, Rex Healthcare, was rejected by the state office that reviews medical projects.

Rex has appealed the decision, plans to supply additional data to the state and expects to win approval by year's end, spokeswoman Melody Hunter-Pillion said.

WakeMed's plan will convert neonatal rooms to private rooms, with extra space for parents and doctors. The project is tied to a new children's hospital on the top floor of a four-story patient tower that WakeMed is building on its main campus. The building is expected to be open by early next year.