The North's Department of Communities has been told the development of the Fort George site must be maximised for the benefit of the city and region.
A Sinn Fein delegation led by Foyle MP Elisha McCallion met with department officials to discuss plans to construct a health hub on the site.
In a statement after the meeting, Elisha McCallion said it was made clear that all options for Fort George must be fully considered, because while Sinn Fein are fully supportive of the proposal to create a health hub in the city, they are not convinced that Fort George is the most appropriate site for it.
Ms Mc Callion says Fort George is a prime regeneration space on the city's riverfront with massive potential to spark regeneration and job creation. The city has failed to properly develop such sites in the past, she says, and that cannot happen again.
She adds, the health hub could be built on any number of sites locally.
Ms Mc Callion also asked if all options have been explored to ensure the optimum social and economic outcomes for Fort George and the wider region.
She says the party will discuss these issues with the Permanent Secretaries of the Departments of Health and Communities.