Nova Scotia government closes deal to formalize sale of care facility

The Nova Scotia government has formalized an agreement to sell a former hotel construction site that's been converted into a health-care facility to a prominent long-term care operator for $114 million. It will pay Shannex more than 10 times that amount over 25 years to run the site.

Officials with the Health Department last week signed the agreement with Shannex to sell the property at Hogan Court in West Bedford. The site will care for patients who no longer need acute care hospital beds but are still recovering or awaiting a long-term care placement.

Derek Spinney, vice-president of corporate services and infrastructure for Nova Scotia Health, said the first wing of the building already has 34 patients and all 68 beds are scheduled to be filled by the end of next month.

Spinney said construction on the second wing with an additional 110 beds is slated to be complete and ready to receive patients at the beginning of April 2026. That's when the sale to Shannex will become official and money will change hands.

"The government continues to own it until it's all complete as per the requirements," said Spinney.

Operating agreement terms released

As part of the deal, Shannex will operate the site for 25 years, with an option for an additional 10 years at the end of that time. The company will be paid about $45 million a year during the life of the contract to operate the site, a per-bed funding formula that follows the long-term care model, said Spinney.

The fee would be less in the first year of operation because not all beds are ready yet. 

The annual bill to the province could change depending on staffing complements, said Spinney. For now, the site will have 349 staff, including 49 registered nurses, 25 licensed practical nurses and 112 continuing care assistants. There are no plans to use travel nurses, he said.

The ability to choose the staffing levels and services at the site means the government saves money compared to having the same patients staying in acute care beds in hospitals, while ensuring they get the appropriate level of care, said Spinney.

Officials with the Health Department would not release the contract on Wednesday, citing the need to review it first to "ensure all the information within is appropriately released."

Past questions about process

Health Minister Michelle Thompson refused to take questions from reporters at Province House about the deal. She, along with her cabinet colleagues are refusing to engage with reporters outside of bill briefings and organized availability in a government-controlled media room across the street from the legislature — a first.

The province bought the unfinished construction site from a private developer more than two years ago for $34 million, despite warnings in an expert report that noted potential limitations in trying to convert the space for the purposes of patient care.

Last year, the province's auditor general released a scathing report on the process the Progressive Conservative government used to buy the property and the volume of untendered contracts related to the project.

Shannex was already tapped to operate the site, but as work proceeded to convert the site to a health-care facility, officials with the company approached the government last year with an unsolicited offer to buy the property and expand it.