A COMPANY which runs care homes across the UK has emerged as a potential buyer of the St John of God Hospital at Scorton.

London-based Bowood Care is to lease the site from the Hospitaller Order for a year from the end of this month. It plans to run the partly-closed hospital as a nursing home and dementia unit for about 50 patients.

Bro John Martin, provincial of the order of monks, confirmed the leasing plan, which could lead to the purchase of the 124-year-old premises by the company.

"During the year, they will seek planning permission to develop the site as a going concern," he said. "If they were unsuccessful, the services would return to the care of the order and we would go for closure."

Two years ago, the order announced plans to close the hospital because of the cost of bringing the premises up to modern standards. Acute services were shut down and the building became a dementia unit.

The hospital annual review revealed it had been running at an "unsustainable" £500,000 loss in the year to April 2003.

Coun Michael Heseltine, who represents Scorton on the county and district councils, welcomed the news of a possible stay of execution for the hospital.

He said: "I hope everybody will pull together to make it work, for three reasons. Nursing care and care for the elderly is an increasing need, it will safeguard employment and continue the beneficial spin-off for the village, and it will preserve the buildings from being vacated and falling into dereliction."

It is believed the hospital's domestic staff has officially been given notice as from March 31, but there is hope that many may be re-employed.

Plans to turn the hospital premises into flats were rejected by Richmondshire District Council late last year after the environment and planning committee said they represented over-development of the site. Members were also concerned about the loss of nursing services from the area.

Bowood Care recently bought Nazareth House, Middlesbrough, where 40 residents remain, with plans to expand the residential home.