It is selling The Vintry Estate in Eastbourne to The William Pears Group, which owns several thousand homes in Britain.
Ex-drinks industry residents living in bungalows on the estate will remain in their homes and continue to receive funding from The Benevolent. But those in the care home itself will be relocated, although they too will continue to receive funding.
The Benevolent plans to use the funds it will free up to double the number of people it helps by 2017, but in their own homes rather than in a care home.
Chief executive David Cox said: “Although it has been regrettable to see a long-standing care home, staffed by wonderfully caring individuals face closure, the on-going deficit was an unsustainable drain on our funds and it is an increasingly regulated sector.
“Our new policy of supporting a far greater number of beneficiaries in their own homes and communities and broadening our reach to embrace bursaries to drinks trade staff in their own workplace positions us far more effectively as a vibrant, viable and progressive trade charity.”
Chairman Chris Porter added: “While we have made a tough and uncomfortable decision with regard to the Care Home, the welfare of our beneficiaries, including those residents in the Eastbourne bungalows, remains paramount.
“This new direction for The Benevolent not only helps us to continue to help them, but extends assistance across the country to a greater number of people in need in our Trade.
“Ultimately it will secure the future position of the charity itself for many years to come.”