Transportation and Infrastructure Minister Fred Hutton said an agreement to buy 54 acres of land from H3 Development for $23 million is nearly complete. (Mark Quinn/CBC)

Infrastructure Minister Fred Hutton says an agreement to purchase land for a new St. John's hospital is almost complete -- with the same company that announced it was donating 10 acres of land to the province for the hospital on Monday.

The site for the health-care campus to replace the St. Clare's Mercy Hospital was announced on Monday. On Friday, Hutton said there's an agreement with H3 Development to purchase 54 acres of land in the Kenmount Crossing area.

"It's not quite there yet, but we do have an MOU, a memorandum of understanding, with them to do this," Hutton said.

Two representatives of H3 Development, Bert Hickman and Glen Hickey, were also a part of the announcement on Monday. Hickey told reporters that the development group was donating 10 acres of land to the hospital site, but there was no talk of any further land being purchased.

Now, as first reported by allNewfoundlandLabrador, the government's arrangement has moved beyond a donation. The province is buying the remainder of the land from H3 Development for around $23 million.

WATCH | N.L.'s deal with H3 Development could be completed soon:

A public tender for the land wasn't issued. Hutton said it isn't required in this case.

"We're not required to do a public tender for land purchase for facilities that [The Department of] Infrastructure is building. We basically, you know, look at what would be the best option in terms of where a facility like this, a health-care facility, would go," Hutton said.

The new site for the hospital to replace St. Clare's in St. john's was announced on Monday. (Arlette Lazarenko/CBC)

Hutton said there wasn't enough Crown land available in the Kenmount Crossing area to build a hospital of the size the government believes is required.

"We need to have something roughly the same or larger than [the Health Sciences Centre], which is, as I mentioned, about 54 acres," he said.

There is Crown land adjacent to the lot, however, which Hutton said also opens up opportunities for things like housing development and access to the new hospital from the Outer Ring Road.

Hutton said Hickman approached the government with the land after learning the new hospital wouldn't be placed at the site of the former Grace Hospital in St. John's. The purchase agreement wasn't mentioned during the announcement as it wasn't completed at the time, he said.

A request for proposals will be issued to construct the hospital.

"We're still a ways out from that, but obviously with respect to anything that's built there, there has to be an RFP. That's part of our public procurement," Hutton said.

CBC asked the H3 Development Group for comment, but hadn't heard back as of Friday evening.