The site of the former Dartmouth Hospital is going up for auction next month after the ‘preferred’ buyer failed to close the deal in January due to a shortage of cash.

The auction will take place on July 18 “as the preferred buyer was unable to exchange and complete”, Torbay and South Devon NHS Foundation Trust said.

The failed buyer is believed to be London-based developer, Dartmouth Riverside Ltd.

The NHS said the reserve price was “commercially sensitive” but gave a guide price of between £1.4m and £1.5m for the former hospital site and £475,000-£500,000 for the Syon Place clinic, a two-storey building that is also being considered for residential conversion, according to Charles Darrow, the Devon-based property agents handling the forthcoming auction.

The old Dartmouth and Kingswear Community Hospital
The old Dartmouth and Kingswear Community Hospital (Charles Darrow Auctioneers)

The firm previously oversaw the auction of the abandoned former hospital at Bovey Tracey.

Both sites, which have to be sold to help fund the town’s recently opened £5.4 million health centre, previously went on sale through property consultancy firm, Montagu Evans.

Liz Davenport, the head of the NHS Foundation Trust, said it was “unfortunate” that the buyer was unable to complete the sale.

She said: “We fully recognise that the former hospital has been a focal point within the town for many years and that local people have a deep interest in its future. It is unfortunate that the preferred buyer was unable to exchange and complete the sale and we have, therefore, taken the decision to list both properties for auction with a reserve price in line with the NHS Estate Code.

“We would like to reiterate our thanks to Dartmouth Town Council for working with us over the past few years to ensure we deliver best social value to the people and communities of Dartmouth...as we seek to dispose of the properties and fund our investment in the new health and wellbeing centre.”

The former Syon Place clinic
The former Syon Place clinic (Charles Darrow Auctioneers)

Although Dartmouth council was aware that the developer lacked the finance as far back as last year, the news has angered local councillors.

Dartmouth Cllr Ged Yardy said he was “frustrated” at the outcome and “disappointed” with the developer.

He said: “I’m upset because I’ve literally spent four years trying to get to the point of (finding) a good solution. We’ve wasted too much time on an abortive deal that has not gone forward.”

Last year, South Hams District Council (SHDC) lifted a covenant that was intended to save part of the site for social use, but Mr Yardy said he had received assurances from the NHS that ‘social value’ would be taken into account at the next auction.

However, Cllr Kim Sturgess said both the collapsed sale and the lifting of the covenant meant the people of Dartmouth “have lost both a working hospital and now any financial advantage the sale of this Riverside site will bring”.

Cllr Dawn Shepherd, who like Mr Yardy is part of a working group that is negotiating with the NHS on the site’s future, said she would fight on to secure a deal.

“We need something for this town out of this mess that they’ve created,” she said.