Mayor Kenney accuses Hahnemann owner of ‘trying to make a buck’ on the coronavirus

Update: Mayor Jim Kenney on Thursday said the city has ended negotiations to use the former hospital and will instead pursue other options.

As Philadelphia officials scramble to expand the city’s hospital capacity in time to handle the expected surge of patients with the coronavirus, Mayor Jim Kenney accused the owner of the former Hahnemann University Hospital site on Tuesday of “trying to make a buck” out of the pandemic by seeking a high rent for his building.

But Joel Freedman, the California businessman who owns the property, said he believes his offer to rent the property for almost $1 million a month is “a very reasonable, heartfelt offer to the City of Philadelphia," his spokesperson said in response to Kenney’s comments.

City officials are negotiating with Freedman for the hospital, which closed last summer after American Academic Health System, which owned it, filed for bankruptcy. The property itself is owned by Freedman and was not part of the bankruptcy.

Brian Abernathy, Philadelphia’s managing director, said at a news conference Tuesday that negotiations with Freedman have been challenging.

“I think he is looking at this as a business transaction rather than providing an imminent and important need to the city and our residents,” Abernathy said.

Freedman is also frustrated with the negotiations, but wants to help the city, said spokesperson Sam Singer. He said Freedman offered to rent the 500-bed facility at a daily rate of $60 per bed, which would total about $910,000 per month. (Singer said earlier Tuesday that the rate would be $70 per bed per day, which would have totaled more than $1 million per month; he corrected the figure hours after The Inquirer published it.) A city spokesperson said Freedman was seeking about $1 million per month in rent plus estimated fees.

Singer noted that California is paying $2.6 million per month to use a shuttered 366-bed hospital in Los Angeles during the pandemic.

“What we’re proposing is a hugely, deeply, discounted rate compared to other known comparable situations,” Singer said. “We want to be of assistance to the city and to the community.”

Kenney disagreed with that characterization of Freedman’s offer.

“We have the owner of the Hahnemann hospital jacking up monthly prices,” he said. “People will take advantage of trying to make a buck out of this, and I think that again is sad.”

As of Tuesday afternoon, 23 patients with the coronavirus were hospitalized in Philadelphia, said Public Health Commissioner Thomas Farley. Officials expect that number to grow and are worried that the city could run out of hospital beds for patients, as has happened in other places around the world.

Even if the city can reach an agreement with Freedman, it could prove difficult to prepare the hospital to reopen as a medical facility. Conversion would require “extensive work," Mike Dunn, a spokesperson for the city, said Tuesday. He said the city is hoping to find a facility that could hold several hundred beds.

State Health Secretary Rachel Levine said Tuesday that reopening the hospital would be “really unlikely,” but signaled that she would leave it up to Philadelphia officials.

“It has been empty for six months," she said. “I think it would be really challenging to stand up a facility such as Hahnemann.”

The hospital’s closure sparked an uproar over lost jobs, medical residency positions, and fears that Philadelphia’s most vulnerable citizens would lose a needed care option. Presidential candidate Sen. Bernie Sanders even chimed in at one point. The clamor to reopen it has been significant, but its condition — right now it doesn’t have any beds — has been a stumbling block.

Weeks ago, city officials discussed using Hahnemann not as an acute-care hospital, but as a quarantine site for people who had no other place to go. If that were to happen, it would not require state licensure.

Abernathy said discussions are also ongoing about other potential sites, which he declined to name.

The city also has a lease for the Holiday Inn Express in Center City, which Abernathy said Tuesday would be used as a quarantine site for homeless residents as well as other people who are unable to isolate at their homes.

Staff writers Justine McDaniel and Tom Avril contributed to this article.