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Expressions of interest to buy Toowong Private Hospital have officially closed, four months after the 58-bed private psychiatric facility shut its doors.
A spokesperson for commercial and residential real estate agency Colliers said there had been a mix of interested buyers in the lucrative 5835-square-metre site, including from private developers and healthcare representatives.
They said a potential sale was in the works.
Toowong Private Hospital is on a sizeable block, four kilometres from Brisbane’s CBD. Credit: Courtney Kruk
Toowong Private Hospital was opened in May 1976 by Noel Austin Kratzmann and provided crucial in-patient and out-patient psychiatric care to Queenslanders for more than four decades.
Towards its end, the 58-bed psychiatric facility treated an estimated 3000 patients a year and employed 154 staff.
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The family-owned facility entered voluntary administration in May, citing rising costs and issues negotiating payments from private health insurers, leading to untenable financial strain and unserviceable debt.
A report obtained by this masthead from EY, the administrators appointed to the facility, showed the company tried to find a buyer in mid-2024 and received four expressions of interest – all below market value.
“Unfortunately, for the reasons outlined above, the expressions of interest received were not commercially better than the closure and piecemeal sale of the company’s assets,” the report states.
The report also indicated that, by 2024, the hospital’s net operating losses amounted to $4.7 million.
Toowong Private Hospital continued to operate for months before its eventual collapse and closure on June 11.
The Australian Private Hospitals Association described the news as “the latest casualty of the insurer-induced viability crisis engulfing private hospitals across Australia”.
“The closure comes in the wake of health insurance companies pocketing an average $2 billion a year record profits from people’s annual premiums, as well as $3.5 billion in ‘management fees’, while short-changing private hospitals by over $1 billion a year,” they said.
“That is, refusing to pay for the care of insured patients in full.”
A campaign to sell the site was launched shortly after, with Colliers advertising opportunities to “maintain, develop or repurpose in the inner-west corridor”.
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Ahead of expressions of interest closing on Thursday, a spokesperson for EY told this masthead “the liquidators have continued with their statutory duties and are currently taking steps to realise the company’s assets for the benefit of its creditors”.
“Once the company’s assets have been realised, the liquidators will distribute proceeds to creditors, as applicable.”
The Crisafulli government was urged at various points to step in and buy the hospital to prevent its closure.
In response to a question on notice in August, Health Minister Tim Nicholls reinforced the government’s position that the site was not considered suitable for public sector acquisition.
“Public patients have not been treated at the facility since the pandemic,” Nicholls said.
“I am advised that the facility would require significant refurbishment to meet contemporary clinical standards and the complex needs of public mental health patients, including older patients with co-morbidities.”
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