The investor who bought Philadelphia’s Hahnemann University Hospital before its collapse failed to win a bankruptcy court’s approval to take out a $17.5 million loan on the defunct healthcare center’s underlying real estate, WSJ Pro Bankruptcy reported. Joel Freedman was denied court approval to put up the former hospital’s property as collateral for a mortgage loan he said he needs to cover ongoing costs stemming from Hahnemann’s 2019 bankruptcy, which left him in control of its downtown real estate. After the bankruptcy, Hahnemann closed its doors for good despite protests from doctors, nurses and community groups. Bankruptcy administrators have been probing how Freedman split the hospital’s healthcare operations from its real estate, which wasn’t included in the chapter 11 filing. Freedman in October sought a bankruptcy-court order confirming he could encumber the properties to secure a $17.5 million loan from Gordon Brothers, a restructuring and investment firm. The proposed 15-month loan would refinance the existing mortgages on certain assets, including the premises once occupied by Hahnemann, while granting a first-priority lien to Gordon Brothers, according to court papers. Freedman said in court filings that, despite the hospital being closed, the property requires ongoing maintenance, security and upkeep to preserve its value. Professional fees and pension obligations stemming from Hahnemann’s closure are also adding up, according to his papers.
