AG Ready to Sue if Allure Group Doesn’t Build LES Health Care Facility by 2022

And so the Rivington House saga continues apace…

Under the terms of the settlement with the New York Attorney General last year, the Allure Group is on the hook for $750,000 in penalties and costs to the State, plus an additional $1.25 million to a half-dozen Lower East Side healthcare non-profits. All related to their role in the lifting of a deed restriction that led to the $116 million sale.

Also part of the stinging settlement deal is a commitment, within five years – or by 2022 – to invest about $5 million to construct another Lower East Side health care facility to “fill healthcare gaps caused by the closure of Rivington House.” Allure must open a Department of Health–licensed facility, such as a nursing, primary-care clinic, adult-care, or a substance use treatment facility.

According to a report in Crain’s, the city has identified and reviewed potential sites where the nursing home operator could construct a new facility.

Paul Mahoney, assistant deputy attorney general, told the Health and Human Services subcommittee of Community Board 3 last Thursday that they’re monitoring the situation closely. And stressed that the attorney general’s office could sue Allure if it doesn’t meet the terms of its settlement.

Mahoney said the attorney general’s office purposefully didn’t specify what type of health care facility Allure should operate because it believes the project should address the community’s needs.

“Right now we’re monitoring their progress,” Mahoney told the CB3 panel. “We have seen ideas. We have seen properties named. One of our goals is get that process done. In the real estate environment on the Lower East Side, that’s not an easy thing to do.”

Meanwhile, it’s worth reiterating that co-owner Slate Property Group signed Letter of Intent with Mount Sinai for a 30-year lease at 45 Rivington Street. The hospital behemoth is planning to move its behavioral health services from the Bernstein Pavilion to Rivington House.