Upper Darby School District might buy shuttered hospital next door to high school for $2 million
The disclosure regarding Delaware County Memorial Hospital was made in a court filing in the Prospect Medical Holdings bankruptcy.
Upper Darby School District is considering the purchase of the shuttered Delaware County Memorial Hospital next to its high school as a possible site for expansion. The building is owned by Prospect Medical Holdings, which filed for bankruptcy protection last month.
“We’re always looking for opportunities. We need space,” Superintendent Dan McGarry said in an interview Thursday. “This is one of those options we’re looking to explore, but there is no deal in place.”
Houlihan Lokey, an investment bank trying to sell Prospect properties, noted in a filing Tuesday that it would waive its fee on the potential sale of the Drexel Hill hospital to the school district for $2 million.
Prospect owes taxes to the school district and to the township for the hospital complex, but has been fighting in court over the properties’ value.
» READ MORE: Crozer Health will receive $20M in public funding to keep its Delaware County hospitals open for at least 30 days
Public records show that its current assessment for real estate tax purposes is $108.3 million. That’s how much it value it carried in 2019, which Prospect sold much of its real estate in Pennsylvania and three other states in a $1.55 billion sale to a large real estate investment trust. That deal required Crozer and other local hospital groups to pay rent to Medical Properties Trust.
After Prospect stopped paying rent in 2022, MPT gave the Crozer properties back to Prospect in exchange for a $155 million mortgage. Under that arrangement, completed in July 2023, Delaware County Memorial was valued at $17.4 million.
That figure is more than 25% less that the $24 million value of the hospital’s real estate when Prospect acquired it in 2016.
Delaware County Memorial has been closed since November 2022.
Upper Darby has one of the Philadelphia region’s largest school districts and is in a densely populated area, making it difficult to find land for expansion.