The hospital was founded in 1431 by the wealthy Lady Maren Hemmingsdatter with the gift of a large house, adjoining land and an endowment as a "House of the Holy Ghost" (Danish: Helligåndshus), common in Denmark at that period, a charitable institution of a religious nature for the care of the sick, old and poor.
The monastic complex when completed in 1500 consisted of four ranges round a quadrangular garden with the magnificent church on the south side, and separate wings for the male and female religious.
The work of the hospital was paid for with income-producing farms, mills and fishing rights scattered throughout northern Jutland.
The hospital was also authorized to send out "gatherers" who solicited donations of food, cloth, money or goods for the benefit of the sick poor.
After the Reformation, Aalborg had three large churches without religious organisations to provide for their upkeep, and the townspeople did not want the cost of their maintenance.