In 1944 the east part of the Hospice was destroyed by Allied bombing, along with many building in the heart of the Jewish quarter. In the years following, the surviving part stood forlorn in a deserted neighbourhood. It was occupied by poor immigrants from the neighbouring islands until 1986, in slum conditions.

The Hospice of St. Catherine was one of the 20 state-owned properties under the jurisdiction of the Archaeological Receipts Fund entered in the restoration programme of the Office of the Medieval Town, founded in October 1985.