Wirral Council has granted planning permission for a £1.5m project to build a day care centre at Hoylake Cottage.
The project is earmarked to be built on the site of the existing 100 year old building.
The approval paves the way for the charitable trust to launch an appeal to fund the new building.
It follows the completion last year of a £3.25m 60-bed nursing care facility on the Birkenhead Road site.
Hoylake Cottage closed as an NHS hospital in 1983 and support from the community kept it open as a centre for older people.
It is hoped building work will start in 2012 and the new centre will open the following year.