The £11m regeneration scheme was carried out by the taxpayer owned Manx Development Corporation
Talks were held to lease the entirety of the former nurses' home in Douglas to Manx Care before the 37 flats were put on the open market, a Freedom of Information request has revealed.
Documents show that the Manx Development Corporation (MDC) was in talks with several departments as it refurbished the site.
Renamed Thie Clag, the £11 million regeneration scheme was carried out by the taxpayer-owned MDC as its first work to bring government owned brownfield sites back into use.
Originally slated to be used for key worker housing, the MDC engaged with several government departments - but received 'limited' interest.
Released emails between MDC and Manx Care show that talks were held over leasing the entire building to the healthcare provider as housing for its staff.
However, the emails show that MDC said this 'could open [us] up to public criticism that we are only developing buildings for government departments', suggesting it retained five flats to rent privately.
The proposal to lease the flats to Manx Care never came to fruition and by May 2025, government emails said '70 percent of the apartments have already been let, they are all with key workers which again was our target'.
Despite this, in response to a series of questions about the development, an unidentified person at MDC said that 'there are no restrictions on who can live in this building', they later added that CG [presumed to be Cowley Groves as letting agent] was prioritising key workers, however they later added 'the definition of a key worker is not for MDC to define'.
This is despite Manx Care saying in its expression of interest letter in February 2024 that the building 'has been targeted towards key workers'.
A key part of the discussions throughout the period was whether or not key workers could have pets and/or children.
In its responses MDC was against pets, a decision reflected in Treasury board minutes from March 2025 where it was said that 'children would be allowed to reside in the property, but no pets would be allowed'.
Despite this being considered a 'major own goal' by then treasury minister Dr Alex Allinson, it was eventually it was agreed in April 2025 that the flats are not pet friendly, but children would be allowed.
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