It emerged earlier this month that the preferred bidder for the project had pulled out.
Plans are back on track for a new 50-bed community nursing unit in the midlands.
The development, to be located in the Clonbrusk area of Athlone, was delayed after the preferred bidder pulled out.
Another developer has agreed to take on the contract with work expected to begin next year, once the public participation process is complete.
The update comes from a meeting of the Dublin Mid-Leinster Health Forum, which took place yesterday afternoon.
The HSE plans to relocate patients from St. Vincent's Care Centre to the new facility, with plans to also accommodate the South Westmeath Hospice in the new location.
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