The State University of New York Downstate Medical Center has found a possible cure for its massive financial headache: shutting Long Island College Hospital and selling the property for a cool half-billion.
The state bought the 155-year-old Cobble Hill institution in 2011 – and in a interview Monday with the New York Daily News, university chairman Carl McCall said that the purchase “seemed not to have been a sound acquisition,” adding that university trustees could vote in less than a month to shutter the hospital.
The hospital’s property valuation comes from a Jan. 17 audit of Downstate by the New York State Comptroller, which estimated that sale of the institution’s property, building and equipment could net $200 to $500 million.
That money would come in handy for Downstate, which could go broke “within a matter of months” — perhaps as soon as May — the audit said. Downstate currently loses $3 million a week, with its losses from 2012 likely to exceed $200 million, according to the report.
The state’s purchase of the Cobble Hill hospital – which had $170 million in debt at the time – was a key factor in Downstate’s financial troubles, the report found.
But the hospital’s possible closure is prompting a backlash. On Friday, hundreds of nurses, doctors, community members, and elected officials rallied in front of the medical center chanting “Save LICH! Save LICH!”
“This is the only hospital that really serves at least this side of Brownstone Brooklyn,” said John Heyer II, a lifelong Carroll Gardens resident and member of the Carroll Gardens Neighborhood Association. “It’s a real loss should we lose our emergency room and our other facilities.”
And would-be luxury condo developers are bound to be disappointed in any sale of the property, said Judy Stanton, the executive director of the Brooklyn Heights Association, pointing out that apart from the main hospital building, the remaining real estate is in a limited-height zoning district.
“From a cold, crass, real estate point of view, someone might find it more valuable, but there is not a housing shortage [in Cobble Hill],” Stanton said. “There’s a health-care shortage there.”
The hospital’s merger with Downstate was first seen as a boon to the long-suffering institution, which accrued its $170 million debt under previous owners Continuum Health Partners. But current hospital employees blamed both Continuum and Downstate for its woes.
“For the last 17 years we had no management. No leadership, nobody to check on our finances. ,” said Dr. Mike Atallah, the chief medical officer at the hospital, who has been working there for 40 years.
“Where are our patients going to go?” Atallah asked. “We need to keep this place going. It’s not fair to take from this neighborhood a hospital that provides care.”
Reach reporter Jaime Lutz at [email protected] or by calling (718) 260-8310. Follow her on Twitter @jaime_lutz.