Healthcare facilities, including hospitals, are among the most challenging assets to maintain and modernize. An accurate performance assessment is essential for the appropriate prioritization of the subsystems that are competing for limited capital-renewal funds. Traditionally, physical condition has been the primary indicator of performance; however, other criteria have recently been added: level of service, sustainability, and risk, all of which are crucial for hospital buildings. This research introduces a practical and efficient framework for capital renewal for hospital facilities. The framework incorporates five unique aspects: (1) a two-dimensional hierarchy that accounts for the interrelationships between the hospital systems and the hospital spaces; (2) a multi-criteria performance assessment process that combines physical condition, level of service, sustainability, and risk of failure; (3) a visual all-on-site inspection application on hand-held tablet; (4) a mechanism for efficient prioritization of capital renewal tasks; and (5) optimization process for near-optimum allocation of capital-renewal of the limited capital renewal budget. The framework assesses hospital subsystems, incorporating consideration of the service quality within the indoor spaces and their impact on related subsystems. For renewal purposes, an appropriate subsystem priority index is then computed accordingly, taking into account the multi-criteria performance of the subsystems. Surveys of hospital maintenance experts have been used both for the collection of data for the development of the framework and for its validation. A prototype of the framework has been implemented in a user-friendly application whose performance was tested through two hospital case studies, the first of which was also employed for testing the prioritization and optimization functions of the framework. The results of six case study scenarios, with varying budget constraints and objective functions demonstrated the practicality and capability of the framework with respect to maximizing the performance of the facility relative to any desirable performance criteria. The proposed framework re-engineers the traditional process of facility performance assessment and also significantly enhances the capital renewal process by speeding the assessment process and efficiently allocating the renewal budget to maximize the return on the investment. This framework can be easily adapted to other types of building facilities and other infrastructure assets, thus contributing to sustaining the economy and the welfare of residents.