By 1871 the Dispensary in Hungate was deemed to be inadequate and the plan to build a purpose-built hospital was formulated. The new hospital was to have more space, better facilities and more staff. Fund raising took place in a relatively short time, mainly via donations. A piece of land in Fair Close was donated by Mr John Crisp. A ceremony to mark the laying of the Foundation Stone by Lady Clarke took place on 10th July 1873; as part of the ceremony a bottle with a copy of the current East Suffolk Gazette, a list of the donors, and a list of the Corporation's members was placed behind the stone. The cost of the build was £1500, and it was completed in June 1874.

The first few weeks after its completion saw it used as an exhibition hall, where locally ‘loaned’ paintings, china and other valuable items were displayed, and for an entrance fee, 2s 6d, visitors could go and view them. Children from the National School were given free visits to the exhibition. The money raised was used to fit out the building. The East Suffolk Gazette edition of the 23rd June 1874 gives a description of the exhibition just before it opened to the public.

The ground floor rooms are devoted to objects of Natural History.

In Room 1, to the left of the entrance hall are to be found Himalayan pheasants, birds' eggs, cases of moths and butterflies.

In Room 2, to the right of the entrance hall, a collection of birds, most shot at Benacre, and a black swan. More butterflies and moths.

In Room 3, on the ground floor, are more stuffed birds, trays of shells and fossils. A case containing bronze and flint items found in the neighbourhood of Beccles.

The staircase has two paintings displayed: The Butcher Absent by Snyder and a Lion's Head painted by Bird.

Upstairs Room 1 contains about 70 pictures, a large collection of china and a mosaic excavated in Naples.

Upstairs Room2 contains watercolours, statues, fine needlework, ivory fans, enamel objects and paintings from India, China and Turkey

Upstairs Room 3 displays a number of engravings, prints and sketches.

Upstairs Room 4 contains about 50 line engravings, after the old masters.

Upstairs Room 5 has the chief pictures, works by Carlo Dolci, Rachel Ruisch, Jansen. Van Goyen. Teniers. Phillips, Michael Angelo, Huysman of Mechlin, Sir Peter Lely, Salvator Rosa, Edwin Cooper. In addition there are African carvings and other curiosities.

The Landing displays a collection of swords and warlike weapons.

The hospital formally opened to patients on the 28th October 1874.

The annual running costs of the hospital were expected to be around £300, with the main part of the money being raised as it had been with the Dispensary, via subscriptions, donations and legacies. The aim of the hospital was to “cure and offer relief of the poor and others, who could not be efficiently treated in their own homes. But infectious, incurable and consumptive cases would not be admitted.“

A sliding scale of subscriptions, similar to that used at the Dispensary, permitted the Subscriber to refer a patient to the hospital.

A Subscriber of two guineas or upwards per annum should be a Governor.

An Annual Subscriber of six shillings would be entitled to recommend one out-patient, ten shillings and six pence two out-patients, one guinea four out-patients.

An Annual Subscriber of two guineas may recommend one in-patient and four out-patients in the year.

Clergymen, Ministers and others for every three guineas collected, shall have the privileges of a two guinea subscriber for the first two sums of three guineas, and a guinea Subscriber for every subsequent three guineas.

That Benefactors of five guineas, in one sum, shall be entitled for life, to the privileges of a half a guinea subscriber; of ten guineas to those of a guinea Subscriber; and twenty guineas to those of a two guinea Subscriber.

That ladies subscribing two guineas shall be entitled to vote either personally, or by proxy given in writing, that clubs shall be entitled to vote by some member of their body, or other person appointed by them in writing.

That the Medical Officers shall each have the privileges of a two guinea Subscriber.

It was possible for individuals to pay for themselves if they had sufficient funds, the rate being 3s 6d to 7s 6d weekly for an in-patient and 5s for an out-patient, but as with all patients and referrals they had to be agreed by the Medical Committee.

In-patients would only be admitted for up to six weeks and an out-patient seen for only up to three months. The Governors could decide to waive part of the fee if they thought the case deserving but people were expected to pay what they could towards their own care.

Medical arrangements were to be under the supervision of a Medical Committee of three, formed by the qualified Medical Officers of the hospital. Domestic arrangements would be under the supervision of a Committee of three ladies appointed at the Annual Meeting, who should be either an Annual Subscriber or a member of the family of an Annual Subscriber. As well as the Medical Committee there would be a Nurse who would act as Matron and live at the hospital and a Secretary.

The Hospital Annual Reports show that as well as individuals an increasing number of local Churches, organisations such as the Town Council, the Feoffees, and clubs or workers' organisations paid subscriptions. SW Rix once again provides us with some of the paperwork associated with the organisation and running of the Hospital. Volume 33 contains 8 of the Annual Reports between the period 1876 and 1888. The 1886 report shows that in the year 1885 to 1886 there were:

78 Indoor Patients of which 42 were discharged cured; 23 Discharged Relieved; 2 Discharged Incurable; and 4 Dead; 7 were still in the Hospital at the time of the report.

281 Outdoor Patients of which 122 Discharged Cured; 65 Discharged Relieved; 13 Discharged on expiration of time; 9 Discharged for non-attendance; 6 Discharged too ill to attend, and at own request; 1 Discharged Incurable; 1 Dead; and 64 still on the books at the time of the report.

Income from Subscriptions £237 18s 6d; Collections at Churches and Chapels £101 1s 11d; Legacies £20.

Donations £37 14s 5d. Other sources brought the complete total up to £527 7s 4d. Outgoings were £526 13s 9d, showing that a small balance would be carried forward.

The accounts show that the staff at the hospital was now a Matron, a Nurse, a Dispenser and a Secretary, as well as the unpaid Medical Officers.

Concerts and other events were held to help fund the hospital, and in 1887 an extension was built to add another ward. The cost of some £290 was largely met by a donation of £270 from the Jubilee Celebration Committee. An East Suffolk Gazette newspaper report dated 8th November 1887 states that “the new ward has been constructed over the existing accident ward, the whole hospital has been re-painted and decorated. A large lantern or skylight with archimedean ventilator, and with opening windows on all four sides over the well of the staircase, the effect of which is to greatly improve the ventilation of the hospital as a whole.”

By the start of the 20th century the hospital was beginning to struggle to meet the needs placed upon it, and so during 1913 and the first part of 1914 plans were drawn up to build a new hospital with more modern facilities. The expected cost of the replacement hospital was around £12,000. The start of the First World War put the new hospital project on hold. For the 1914-18 period the Fair Close hospital continued to support and treat the civilian population. Military personnel were treated in the Red Cross hospital in Fredericks Road.

Towards the end of the war thoughts turned to a suitable and practical memorial to those who had fought and the plans for the hospital were revisited and fund raising started again. The new hospital, the Memorial Hospital in St Mary’s Road, opened, in 1921, with many of the internal fittings and equipment, such as the x-ray machine, being taken from the Fair Close hospital. The Fair Close hospital building still exists and has been converted into apartments.

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