The European Union and two banks will partly fund the development of a community nursing unit in Killarney.
The EU, Bank of Ireland, and German state bank, Nord LB, are providing €250 million towards the development of 530 new nursing home beds across the country.
The beds will cost the HSE €24 million a year.
Construction of the 130-bed community nursing unit in Killarney is expected to begin before Christmas.
The Killarney project is the largest of the seven new community nursing units to be constructed nationally, which are being delivered under the public-private partnership.
It will include three ten-bed households specifically for people with dementia.