Lawyers for the bankrupt and shuttered Hahnemann University Hospital have reached an agreement with former owner Joel Freedman, his lenders, and other creditors on how proceeds from the eventual sale of the North Broad Street properties will be split, the Philadelphia Inquirer reported. In a rare bankruptcy occurrence, Hahnemann real estate that was kept out of the 2019 chapter 11 filing will be consolidated into the bankruptcy estate, making at least some of the proceeds available to repay Freedman’s creditors, who are owed roughly $300 million. The agreement ensures that Freedman won’t get rich from turning the safety-net hospital into condos, as irate politicians and others thought would happen. The extraordinarily complicated agreement describes millions in crisscrossing payments, including a final pension payment of as much as $23.5 million from Tenet for union workers represented by District 1199C, before the sale even happens. If Bankruptcy Judge Mary F. Walrath approves the 469-page memorandum of understanding, it will end a dozen pieces of litigation in Pennsylvania and Delaware courts that have prevented progress on the sale of five properties that were not in the the bankruptcy because Freedman put the real estate into separate companies from the business of the hospital.
