NEW YORK CITY–The US Bankruptcy Court in Manhattan on Thursday approved a $260-million sale on Thursday of the Saint Vincent Catholic Medical Center’s West Village Campus to Rudin Management and North Shore LIJ-Health System, LIJ president Michael Dowling and Rudin CEO Bill Rudin confirm. The deal, approved by Bankruptcy Judge Cecilia G. Morris April 7, is a partnership by both developers to create a freestanding 24-hour emergency and ambulatory surgery facility, as well as 590,000 square feet of residential mixed-use development on the east side of the campus.
“The court is convinced that the likelihood of an equal or better sale opportunity is slim to none,” Morris says in an e-mailed statement, praising the sale. Under the proposed plan for the site, North Shore-LIJ plans to invest $110 million for the redevelopment of the landmarked O’Toole building on the West Side of Seventh Avenue into a Center for Comprehensive Care, which would include 24/7 emergency services and a full-service imaging center, which Rudin is providing $10 million to offset North Shore-LIJ’s costs for the historic structure. The developers are anticipating a fall 2013 opening and are currently obtaining necessary approvals from city and state officials.
“With today's approval by the Bankruptcy Court, West Siders are one step closer to having access to the high-quality emergency care they need,” Rudin and Dowling say in a joint press statement released Friday morning. “We’re especially pleased the judge confirmed what we've been hearing repeatedly from residents, business owners and community leaders,” describing that the agreement reached last month by SVCMC is “a great deal for the community” and “would ensure an innovative, return of comprehensive health care to the neighborhood.”
National managing principal Mark Toney of Grant Thornton LLP served as chief restructuring officer for St. Vincent’s and completed the healthcare bankruptcy and real estate transaction, while Kramer Levin Naftalis & Frankel LLP served as lead counsel. After the SVCMC board posted operating losses and $1 billion of liabilities, the board recommended closure of the facility in 2010. Toney says in a statement that “while St. Vincent’s continues to be saddened by the ultimate closure, we are pleased that we could collectively provide an opportunity to bring a 21st-Century new healthcare model to the area,” which is expected to treat 72,000 patients annual and create jobs for 300 medical professionals.
However, the redevelopment was not universally popular. Dudley Gaffin, of Gaffin and Mayo PC, former City Council member Alan J. Gerson and Dr. Robert Adelman, also known as the “alternative purchaser group,” objected the sale and requested proposals from other developers for the campus, court documents show. According to an affidavit filed on Thursday in response to the sale, Gerson, who served on the council for eight years, said the Greenwich Village community “overwhelmingly opposed” the deal, voicing concerns that residents were not afforded opportunities to provide input on the medical services that should be provided to meet the needs of the neighborhood.
Gerson adds in the affidavit that he has held discussions with high officials of two major New York City located academic medical centers who have both “expressed a strong interest in working with a developer to provide more medical and emergency services than the current plan proposes to provide,” as well as developers who are interested “in purchasing the site” for more than the $260-million sale set forth. Gaffin did not return a phone call to GlobeSt.com in time for deadline.
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