Toowong Private Hospital has passed from the hands of one Brisbane family to another, with liquidators selling the collapsed mental health facility for more than $12 million to local developers.
The psychiatric hospital, which collapsed under millions of dollars worth of debt, was founded by influential Brisbane builder and philanthropist Noel Austin Kratzmann in 1989.
It was still owned and operated by NA Kratzmann & Sons until its sudden closure in June last year.
Liquidators sold the 5835 square-metre Milton Road property in Auchenflower to Carbone Developments, led by second-generation developers and brothers Don and Tony Carbone, for $12.2 million.
Carbone Developments have been operating in Brisbane for more than 20 years.
According to their website, they “specialise in delivering bespoke contemporary medium- to large-scale residential projects located in specifically selected urban locations”.
The brothers bought the fire-damaged, heritage-listed Broadway Hotel in Woolloongabba for $8.8 million under their related entity Broadway Projects in 2021.
Despite securing approval to restore the historic pub and build a 34-storey apartment tower behind it, the developers put the hotel back on the market earlier this year to focus on their pipeline of medium-scale developments in Brisbane’s northern suburbs.
They have recently started construction on The Atley apartments in Mitchelton, next to their existing Parque complex.
Carbone Developments declined to comment when contacted by this masthead.
Toowong Private Hospital, which treated 3000 patients annually, was once one of Brisbane’s leading psychiatric hospitals. It collapsed amid a hospital funding crisis that is putting private health facilities across the country at risk.
Administrators EY were appointed last year, but found no viable option to keep the hospital operating, and the Crisafulli government rebuffed doctors’ and patients’ pleas to acquire the facility.
Selling agents Colliers marketed the dual-frontage site as one of Brisbane’s most versatile and rare inner-city land holdings.
“Large development sites in established inner-city suburbs ... are becoming increasingly difficult to secure and, when they do come to market, competition is fierce,” said Troy Linnane, Colliers’ director of Queensland residential development sites.
“The buyers recognised the opportunity to unlock the site’s potential for a new apartment development in one of Brisbane’s most sought-after lifestyle precincts.”
The property is zoned Low-Medium Density Residential (LMR2), allowing for a range of future
outcomes, including boutique apartments, townhouses, retirement living, residential care or
healthcare uses, subject to council approval.
In its preliminary report to the Australian Securities and Investments Commission, EY said the hospital’s net operating losses amounted to $4.7 million by 2024 due to “the decline in patient admissions and inpatient care”.
An industry source with knowledge of the hospital said the facility could no longer service its debts after years of being short-changed by health insurers while the cost of providing treatment skyrocketed.
Greens MP for Maiwar, Michael Berkman, said he was dismayed the state government had refused to save the much-needed psychiatric facility.
“It’s an absolute tragedy that this crucial mental health service is now just another property asset on some developer’s books,” Berkman said.
“We don’t know yet what the developer has planned for this site, but we do know we’ve forever lost a hospital that helped hundreds of people through their hardest times.
“The Queensland government was happy to let Toowong Private Hospital close … If nothing else, this should be a wake-up call – a clear demonstration of how privatised healthcare is failing.”
The hospital provided dedicated trauma and alcohol recovery programs for both current and former military personnel, as well as out-patient support services.
At the time, the state government said it was located too far from other public hospitals and needed a major refurbishment.
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