The state attorney general is investigating actions by the de Blasio administration that allowed the owners of a Lower East Side nursing home to sell their building to a condo developer for a staggering profit. NY1's Michael Scotto filed the following report.
Attorney General Eric Schneiderman is vowing to find out why the city gave the green light for a Lower East Side nursing home, known as Rivington House, to be sold to a developer who plans to convert it into luxury condos.
"There are issues related to the transfer of a building that's supposed to be used for a charitable purpose to a non-charitable purpose," Schneiderman said. "Our charities bureau regulates nonprofits. There are rules that apply to them. So we're looking into it to see that all the proper laws and rules are followed."
Schneiderman's investigation is the latest examination of an issue that has become a major headache for Mayor Bill de Blasio.
On Wednesday, elected officials demanded that the administration turn over all documents related to the transactions that led to the surprise sale.
Last year, the Allure Group, which owned the property, paid the city $16 million to lift a deed restriction that prohibited the building to be used for anything other than a health care facility. Allure then sold the building to a real estate developer for $116 million.
"It's going to be turned into luxury condos for a privileged few? We don't want that and we don't need that," said City Councilwoman Margaret Chin of Manhattan.
The Allure Group did not return a call seeking comment.
De Blasio claims he was left in the dark about the deed change.
"Subpeonas have been issued," de Blasio said. "We're going to get to the facts, and we're going to figure out what we need to change."
Officials in the area say the administration must now create another facility in the neighborhood to replace all the beds that were lost. They are also calling for legislation requiring elected officials be made aware of all proposed deed changes.
"One of the reasons this deed restriction was lifted is that there was almost no public notification, just the City Record. And who in the world reads the City Record?" said Manhattan Borough President Gale Brewer.
The de Blasio administration says it has put the brakes on the kind of transactions that resulted in a facility for AIDS patients being sold to a luxury housing developer. But for residents of the Lower East Side, that move comes too late.