The two countries signed a protocol stipulating that the hospital would be operated jointly and that the Turkish Health Ministry would provide specialized personnel and financial support for the next five years, after which the hospital will be run by Somalia.
The Turkish Cooperation and Coordination Agency (TIKA) - Turkey's international development body - undertook the project.
The estimate amount of the hospital's operating budget is around $135.7 million, of which Turkey will contribute $85.6 million during the five-year period.
Some 36 Somali assistants are expected take part in the hospital's training program each year.
Some 52 Turkish and 91 local staff will work as hospital administrators, head doctors, administrative directors or financial directors. Security will be provided by 40 Somalis and five Turkish citizens.
The hospital will have children, maternity, urology, neurosurgery, plastic surgery, internal medicine, general surgery, anesthesia, eye and dental branches.
The 13,500-square-meter indoor space boasts 12 intensive care beds, 14 newborn intensive care beds, 20 incubators, four operating rooms, a delivery room, as well as radiology and laboratory units.
Erdoğan also attended the inauguration ceremony of a new terminal at Mogadishu Airport, constructed by the private Turkish construction company, Kozuva.
"I wish this building will bring good luck to Somalia, which has gone through hard times," he said.
"Somali people will never forget the aid of Turkish people," said Somali President Hassan Sheikh Mohamoud.
The president is also accompanied by his wife and daughter, Emine and Sümeyye Erdoğan, as well as Deputy Prime Minister Numan Kurtulmuş, Foreign Minister Mevlüt Çavuşoğlu and Economy Minister Nihat Zeybekçi, Science and Industry Minister Fikri Işık, and Forestry and Water Minister Veysel Eroğlu.Hundreds of soldiers were deployed across Mogadishu on Sunday. This is Erdoğan's second visit to Somalia.Somali president Hassan Sheikh Mohamud lauded Turkey for investing in Somalia despite the insecurity caused by decades of turmoil, currently from a terrorist insurgency by al-Shabab, which is allied to al-Qaida. Two days ago three people died when an al-Shabab suicide car bomber detonated explosives at a hotel where the Turkish president's advance party was staying. No Turks were injured in that incident.