1 River Park by Fortis Development at 350 Hicks St., designed by FX Fowle. Rendered courtesy of Fortis Property Group
Eight years ago, many residents of Brooklyn Heights and Cobble Hill, along with elected officials and members of the medical profession, railed against the sale of the Long Island College Hospital campus to a developer whose plans included housing residential as well as an emergency care unit.
Now, this developer’s plans for the site seem to have hit a snag.
Lender Madison Realty Capital has initiated a Uniform Commercial Code, or UCC, foreclosure sale for equity interests, meaning an interest in a business entity, against Fortis Property Group at development sites at 350 Hicks St. . and 91-95 Pacific St., according to The real deal, an industry website.
The site, where Fortis plans two 150-unit condo buildings, is part of an overall development known as River Park.
The building at Hicks Street, 1 River Park, is expected to be 20 stories tall and contain 48 apartments. The Pacific Street building, known as 2 River Park, is expected to have 102 residential units, The real deal reported.
Shortly after winning the bidding process for the hospital site, Fortis secured a $107 million “bridge loan” from Madison, according to Business thread. A bridge loan is a form of short-term financing that can act as a source of funding until a business obtains more permanent financing.
Two years later, Madison provided Fortis with a $297 million construction loan for these properties and another condominium.
“Madison gave us the opportunity to leverage the property at a reasonable cost compared to the dilution we would have suffered had we brought in a partner,” Jonathan Landau of Fortis reportedly said at the time.
A third building, the smaller 5 River Park at 347 Henry St., which is substantially complete, is not part of the UCC seizure. The Fortis website describes it as 75% sold.
The sale by foreclosure of the interests, “which would satisfy a debt of 47.7 million dollars”, is scheduled for September 29. The real deal said.
Fortis was also active in other Brooklyn neighborhoods. Units in the new Dumbo condominium building at 30 Front St., known as Olympia Dumbo, are “the most expensive housing in Brooklyn,” Fortis said on its own website in September 2021.
The old hospital had a troubled history
Throughout the 1990s, and even before, Long Island College Hospital, like many hospitals of that period, was in financial difficulty. In 1999 it was purchased by Continuum Health Partners. However, under Continuum ownership, the hospital’s finances continued to struggle.
In 2011, the State University of New York (SUNY) took over management of LICH, and most observers hailed SUNY as the hospital’s saviour. However, problems soon arose.
According to an article published in the Eagle several years later, “insurance companies failed to pay for the treatment of patients at LICH because SUNY never accredited LICH physicians under the auspices of SUNY with the insurance companies”. This means, in effect, that LICH was treating many patients free of charge. At the same time, the hospital continued to incur daily expenses.
In late 2013, SUNY announced its intention to shut down LICH. This sparked a struggle that ran through both the justice system and on the ground – for example, patients were continually being transferred out of the hospital, and at least at one point the emergency room stopped working. accept patients. There were constant protests at the hospital site.
Finally, in 2014, SUNY administrators and the state Department of Health closed the hospital.