After City Lifts Deed Restriction, Rivington House Building Sold For $116 Million to Luxury Developers

41 Rivington St.

41 Rivington St.

The former Rivington House nursing facility has been sold for $116 million to a group that plans to create luxury housing in the longtime community space. According to the Wall Street Journal, China Vanke Co., Slate Property Group and Adam America Real Estate made a deal for the 118-year-old former school building at 41 Rivington St. (also known as 45 Rivington).

As we have reported in recent months, the sale was anticipated after the Allure Group, a private nursing home operator, closed the building in December. The company, which purchased the property last year for $28 million, has stated that the failure to obtain state Medicaid reimbursements forced the closure. The Allure Group also paid the city $16 million for the deed, which had previously restricted the building’s use to a “Not-for-Profit Residential Health Care Facility.” Community Board 3 and City Council member Margaret Chin supported efforts to lift the deed restriction because they thought it meant the 200-plus-bed nursing facility could continue to operate as a for-profit entity. They were furious with the de Blasio Administration for allowing the building to slip into the hands of luxury housing developers.

Slate co-founder Martin Nussbaum told the Journal that the partnership plans to create about 100 luxury apartments in the building, which borders Sara D. Roosevelt Park. The newspaper reported that the “venture hasn’t decided how much to charge for units but the pricing won’t be at the high end or the low end of the market.”

Representatives from Council member Chin’s office and the office of Manhattan Borough President Gale Brewer have been trying to find out why the city lifted the deed restrictions without any guarantees that the property would remain a community asset. They have told members of Community Board 3 that the initial answers have been unsatisfying.

Allure Group executives have asserted, in conversations with CB3 staff members, that they’ll open a new nursing home facility on the Lower East Side. It remains to be seen whether that will actually happen. Rivington House was a nursing home for AIDS patients until it was sold last year by VillageCare, which said demand for its services had fallen dramatically. The building conversion from a school, in 1992, was financed by millions of dollars in state bonds.

Here’s an edited version of the Rivington House resolution approved by the community board last month:

WHEREAS, in October 2014 Community Board 3 Manhattan supported the conversion of Rivington House from an AIDS nursing home facility to a general nursing home facility; and WHEREAS, Community Board 3 and elected officials and community residents worked very hard to advocate for the 219 nursing home beds at this location to replace the many nursing home beds lost in CB3; … WHEREAS, Rivington House was originally a school sold by the City to VillageCare with a restrictive deed that required the facility to remain a nonprofit nursing home in perpetuity, and VillageCare sold the same facility to The Allure Group with the same deed restriction and now the City (Department of Administrative Services -DCAS) – in November 2015 – has sold the lifting of the deed restriction for payment of $16 million to the City without any guarantee of replacing the nursing home beds within the neighborhood and serving the same population and without guarantee for use of the facility at 45 Rivington as a needed community benefit; and WHEREAS, this action to lift the deed restriction occurred out of public view, with a total lack of transparency and without fair or reasonable public notice to CB3, local elected officials and other community stakeholders; and WHEREAS, this lack of transparency is especially egregious since those stakeholders were the interested parties involved in the October 2014 effort to preserve Rivington House as a general nursing home and preserve the maximum number of beds; now THEREFORE, BE IT RESOLVED, CB3 calls on the City to disclose information as to what transpired with respect to this transaction, and CB3 calls on the City to explore options to reverse this decision immediately; and THEREFORE, BE IT FURTHER RESOLVED, CB3 adamantly opposes any potential conversion of Rivington House to free market housing or private commercial use, as has been made possible by the lifting of the deed restriction; and THEREFORE, BE IT FURTHER RESOLVED, CB 3 believes that the City (DCAS) should not have sold off the deed restriction without guarantee of the nursing home beds being replaced in the community and the facility remaining as a benefit for the community; and THEREFORE, BE IT FURTHER RESOLVED, CB3 must be involved in any transition or change to the Rivington House facility. Rivington House, which was first a school, then an AIDS Nursing Home, and finally a general nursing home facility. Furthermore, this facility should not be sold for private use, which would not benefit the community, but should remain a facility that serves the underserved and most vulnerable; and THEREFORE, BE IT FURTHER RESOLVED, CB 3 believes without question that, if the Administration, elected officials and stakeholders have exhausted all available efforts to reverse this action and the transaction ultimately goes forward, the 219 nursing homes beds that existed in Rivington House nursing facility should be replaced within CB3 to mitigate the loss of many nursing home beds in the last several years.

 

Followup: City Cleared the Way For Luxury Housing at Former Rivington Street Nursing Home

41 Rivington St.

41 Rivington St.

We have more today on the former Rivington House nursing facility, located at 41 Rivington St., which increasingly appears headed for a luxury residential conversion.

The 215-bed home for AIDS patients was sold last year for $28 million to the Allure Group, which briefly reopened the building as the Rivington Center for Nursing & Rehabilitation. But it closed earlier this month, employees of the center telling us that the operator was preparing to flip the building and relocate the facility elsewhere on the Lower East Side. Neighbors have been approached by representatives of the Slate Property Group, who told them the real estate firm is planning to turn the property into a market rate apartment complex.

Executives of the Allure Group have not responded to our requests for an interview. We did, however, hear back from the Department of Citywide Administrative Services (DCAS).  Last month, the city agency agreed to lift a deed restriction in place since 1992 requiring the Rivington Street building to be “limited in perpetuity to a Not-for-Profit Residential Health Care Facility.” The Allure Group paid the city $16,150,000 for the deed. Cathy Hansen, a spokesperson for DCAS said, “The deed restrictions were lifted after a request by the owner to allow the property to be run by for-profit and/or non-profit operators. The deed modifications were approved following a public hearing on June 24, 2015.”

45 rivington street

It was not a surprise to local elected officials or to Community Board 3 that the Allure Group would be petitioning the city for the change (the company is a for-profit entity). They were taken aback, however, to learn that there was nothing written into the agreement assuring the Rivington Street facility’s continued operation as a nursing home.  At the very least, they expected guarantees that the nursing home beds would be transferred to another location within the community. When asked whether the city took steps to preserve the community facility, Hansen responded: “No, the agreement only covered the lifting of deed restrictions.”

We contacted the office of City Council member Margaret Chin, which was involved in brokering the deal to keep the nursing home up-and-running last year. Paul Leonard, her director of communications, said, “We’re disappointed by the recent closure of Rivington House, which for years has served a community with few other nursing home options. We’re currently looking into the status of the limitations on Rivington House’s deed, and will continue to monitor the situation closely.”

K Webster of the Sara D. Roosevelt Park Coalition has been concerned about the fate of Rivington House since it became known in the summer of 2014 that previous owner VillageCare intended to shut it down. The coalition has started a letter writing campaign to the mayor’s office. The sample letter reads, in part:

Please keep (the former Rivington House facility as) a community facility—do not sell our neighborhood out to highest bidder. We need affordable housing, shelter beds, community services. In the midst of your affordable housing agenda it makes NO sense to lose this site for the many New Yorkers who need housing. We restored our community when no one else would come into it due to the high crime here – not even City agencies and departments would come here. Now that we have built a good, solid base for our neighbors, friends, visitors and families we are being pushed out, marginalized and priced out. This building is an institution here – it has always served the public. First as a school, then as an AIDs Hospice (when those patients were not welcome anywhere else)… As you are the Mayor of the “Tale of Two Cities” we ask you to live up to those words.

There are still many unanswered questions swirling around the building, which borders Sara D. Roosevelt Park. The owners have intimated that the closure was triggered by their failure to obtain Medicaid contracts for the nursing home beds. The Allure Group has suggested it will reopen somewhere in the neighborhood, but it’s unclear what building could accommodate a 200+ bed nursing facility. No sales documents or Buildings Department permits have showed up as of yet in public records for 41 Rivington St.,

This much is known about the Allure Group. In October, the Real Deal reported that a 241-unit residential building was being planned on the site of the Nostrand Center for Nursing and Rehabilitation in Bed Stuy. “Marvin Rubin, senior managing partner of nursing home operator the Allure Group, acquired the property… for $15.6 million in June,” the website reported.  A closing date for that center has not been announced, but some contractors have been advised that their services will not longer be needed after February. So the Lower East Side is apparently not alone.

We have contacted the State Health Department to find out about the status of Medicaid-funded nursing home beds at 41 Rivington St. No response. We also reached out to the Slate Property Group. They have not responded, either.

Community Board 3 plans to take up the issue in January.

41 Rivington St. Deed by The Lo-Down