Fortis Property group in Long Island College Hospital negotiation seat

Deal undone! State axes LICH talks with Peebles, turns to Cuomo donor

The Brooklyn Paper
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The state gave would-be-Long-Island-College-Hospital developer Peebles Corporation the boot on Wednesday, moving on to negotiate with its first choice to take over the medical campus, a company with financial ties to Gov. Cuomo.

Negotiations between the state and Peebles, the erstwhile top bidder to develop the former hospital, which closed on Thursday night after 156 years, fell apart in the half-week that followed, putting developer Fortis Property Group in the negotiating seat. The state said Peebles was trying to drastically depart from its original proposal, pushing back its provisions for medical care and demanding public money.

“Several portions of the Peebles proposal have dramatically changed, including the possibility of long delays in the manner and method in which healthcare will be provided at the site,” said State University of New York spokesman David Doyle in an e-mailed statement.

Despite a settlement reached in court last week to keep the former hospital’s emergency department open, Peebles and the state could not hammer out a permanent deal to determine who would run the department, the state said.

The emergency room will remain open for the time being, Doyle said.

“Even though the settlement agreement allowed SUNY to close on May 22, we will continue our best efforts to staff and maintain current services at the emergency department while we negotiate with Fortis,” he said.

But without a hospital attached to it, the facility is little more than a walk-in clinic, activists argue. The emergency department is not accepting ambulances or admitting patients.

Talks also ended because Peebles sought to finance required environmental remediation with taxpayer money, which flies in the face of requirements set forth in the state’s call for bids, Doyle said.

The dissolution of discussions follows the torpedoing of talks with Brooklyn Health Partners, the company that scored highest in a ranking of redevelopment proposals that was supposed to favor bids that called for a hospital at the site as part of a settlement in a lawsuit brought by community groups and unions to stop the state from shuttering the hospital. Peebles and Fortis came in second and third places, though neither plan included a hospital.

Fortis president Joel Kestenbaum gave Gov. Cuomo’s re-election campaign $5,000 last November, while his uncle Moshe — who is not a partner in the firm — gave $12,500 in Jan. 2014. Cuomo controls the State University of New York.

The state originally tapped Fortis last year to develop the land, which is valued at as much as $500 million, without public input, but a judge ordered the state to throw out the deal and find a developer using the settlement-outlined scoring process.

Fortis’ plan calls for apartments, condos, and townhouses, a quarter of them below market-rate, as well as an amublatory surgery center and a cancer center.

One activist said Fortis was always in line to get the prime Cobble Hill real estate with views of the New York Harbor and suggested the second round of bidding was a sham orchestrated by the state.

“This is what they wanted all along,” said Sue Raboy, a member of the pro-hospital group Patients for LICH.

Fortis has partnered with New York University Langone Medical Center and Lutheran Health Care to provide health services at the site in the future.

Reach reporter Max Jaeger at or by calling (718) 260-8303. Follow him on Twitter @MJaeger88.
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Reasonable discourse

Cobbler says:
I am just loving this new reporter The Paper has reporting on LICH with just the unbiased & accurate facts. Finally. Thank you Max.
May 28, 2014, 7:43 pm
Shanny from BK Heights says:
Bravo! The truth is finally emerging. I'm happy to see more journalists digging deep to find the cold, hard, facts on #LICH and Gov. Cuomo's backroom politics. There is corruption at the core of this story. Keep digging, Max!
May 29, 2014, 3:05 am
Curious from Want to Know says:
I don't get it. Wasn't Obamacare supposed to save the hospitals and keep everyone healthy?
May 29, 2014, 6:05 am
Sid from Boerum Hill says:
Hey curious not everything is Obama fault.
NY State recognized it was over bedded for hospital under a Republican Governor called Pataki.
While I disagree with the report- it closed the lowest charging hospitals and none of the expensive teaching hospitals and its conclusions for LICH as well- it had nothing to do with Obamacare. What Obamacare is supposed to do is grant equal access(insurance) for most. This includes preventative care which will further reduce the need for inpatient care and inappropriate use of high cost emergency care as primary care. It wasn't supposed to save every inefficient over used hospital. Although I don't agree that LICH was inefficient or over used but that is another long posting. NY state has the longest length average inpatient care in the country. If this was done to near the average a lot more staffed hospital beds would be unnecessary. What we have seen is the opening of urgent care walk in centers in the community.
May 29, 2014, 8:37 am
The Truth from Red Hook says:
Sue Raboy is aka Remsen Street and has been a activist that wants to use NYS like a piggy bank and let NYS drain it's money to pay for a Hospital the locals do not use. If Peebles would pay for insurance and make a deal instead of trying to find wanys for NYS to pay it would have already been theirs.
May 29, 2014, 9:48 am
Licher from Lich says:
Is that what you call news conspiracy theories?
May 29, 2014, 10:37 am
Matt from Windsor Terrace says:
So...a year after the "community" (that is, a few people in the neighborhood being used by the nurses union) started a tantrum we're back to the same bidder SUNY had originally picked.

How much has this little exercise in futility cost the taxpayers??? OH, but it's all some big conspiracy!!! And hey! Only one more scuttled bid and maybe PRIME can come and save us all!!!

May 29, 2014, 11:28 am
Sid from Boerum Hill says:
There is no insurance available for environmental issues. Its all excluded. The insurance companies won't take the risk either.
May 29, 2014, 11:55 am
Patricia from Carroll gardens says:
Urgent centers DO NOT SAVE LIVES! Wake up your rights are being taken away by a select group of greedy developers. A downsized lich could have saved lives,money and taxes and condos could be built.
May 29, 2014, 8:05 pm
TRUDY from flatbush says:
it a shame that these suny people keep committing crimes against us and no one is arrested.CONDOS before health care,lich save lives
May 29, 2014, 9:30 pm
Between Smith and Court from Carroll Gardens says:
While those of us (who relied on LICH's excellent health care services) can only watch as little Andy Cuomo, Carl McCall and John Williams divide up and go home with their shares of the financial and political booty from this sale, would someone PLEASE "check the math" they used to sabotage this much needed facility? As an insider, I watched how they did it- from the beginning they simply stopped most of their billing and collections, and what they did bill was knowingly riddled with errors. Millions and millions lost, criminally sabotaged in the service of intentional bankruptcy. Why do you think they wouldn't release their records? They are PINCHING themselves with the success of their little enterprise- Oh, and 'Matt' and 'Redhook'? Remember this- sooner or later, EVERYONE needs a nurse. How far will you be able to drive yourselves when YOU do?
May 29, 2014, 11:06 pm
jenny from brooklyn heights says:
finally, we are going to get a major health care provider like NYU in Brooklyn. This is long over due. Many brooklyn residents travel to manhattan to receive care at one of the well known facilities. we don't need a full service hospital here considering brooklyn hospital is not far.
May 31, 2014, 4:46 am

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