Turning hospitals into housing becoming an increasing trend, experts say

NYC Health + Hospitals/Kings County's long unusued psychiatric wing has been converted into housing known as  Camba Gardens II.
NYC Health + Hospitals/Kings County’s long unusued psychiatric wing has been converted into housing known as Camba Gardens II. Photo Credit: Vincent Barone

It has been years since NYC Health + Hospitals/Kings County provided psychiatric services in the G building, but thanks to a redevelopment, the site is once again caring for residents like Clarissa Martin.

Martin, 58, credits her apartment in the new CAMBA Gardens II with helping her stay on top of her physical and mental health and bond with neighbors.

“It’s a bridge back to life,” said Martin, who was previously in the homeless shelter system. “It’s a steppingstone. If I got people around me to guide me and go mentor me and to nurture me, then I got a chance when I go on my own in independent living.”

The $100 million transformation of the G building into a 293-unit supportive housing development has also provided some relief to the municipal hospital system, which would have otherwise struggled to pay for the demolition of the aging structure.

And many are optimistic last week’s ribbon cutting at CAMBA Gardens II will usher in similar welcoming ceremonies.

Mayor Bill de Blasio has pledged to build housing on unused hospital space across the city. And outside of the city’s hospital system, many expect to see more of these agreements, given the increased emphasis on outpatient rather than in-hospital care and the de Blasio administration’s ambitious affordable housing agenda.

Paul Wexler, head of the Wexler Healthcare Properties Team at Corcoran, said some hospitals have found themselves with extra space, as it becomes more common to try to provide health services near transit and residential communities, rather than on a campus. Some hospitals may be able to diminish their budget gaps by offering part of their land to developers and working with the city on affordable housing projects, he said.

“In New York in particular, where you have seen these tremendous numbers for sales in residential properties, if a property is underutilized or incomplete, the ideal for those hospitals is to sell the land,” Wexler said.

Changing medical needs and new funding policies have led to the closure of 19 city hospitals since 2000, according to the state Department of Health. Many of those facilities, including St. John’s Hospital in Queens, St. Vincent’s Hospital in the West Village and Long Island College Hospital in Brooklyn, have been transformed into residences, despite some communities’ opposition.

The new landscape has been particularly tough for the municipal hospital system — called Health + Hospitals — which provides care for those without insurance, offering much of the under-reimbursed care in the city.

But John Jurenko, vice president for government and community relations at Health + Hospitals, said projects like CAMBA Gardens II help.

Under that arrangement, the development arm of the social services provider CAMBA paid the municipal hospital system $2.5 million to lease the site for 99 years. This allows Health + Hospitals to stop paying for electricity and security in the building, and to avoid the roughly $7.6 million it would have cost to abate asbestos and demolish the aging structure.

“We get rid of a dilapidated building that we couldn’t afford to take down, and the community gets housing out of this project,” said Jurenko. “We also have the added benefit of bringing more people in closer to Kings County Hospital.”

Since de Blasio pledged to convert unused hospital space into housing in 2016, the city has announced plans for housing where a 1930s era tuberculosis hospital once operated on the Queens Hospital Center campus, according to Health + Hospitals. In Brooklyn, supportive and affordable housing is slated for a parking lot on the Woodhull Hospital campus.

It is less clear if similar developments will occur outside the municipal hospital system, where communities have become accustomed to seeing condos rise.

Anthony Feliciano, the director of an advocacy group called the Commission on the Public’s Health System, said neighborhoods like the Lower East Side are concerned about another high-end development emerging where Mount Sinai Beth Israel announced plans in 2016 to close an 825-bed facility in four years. At the time, Mount Sinai said it would open a smaller hospital and multiple outpatient centers throughout lower Manhattan.

“What I’m worried about is the old site, and what’s going to be done there,” said Feliciano, who would like the state to more proactively steer development when it formally decertifies hospital beds and facilities. “They haven’t been really good at monitoring on that.”

A source with knowledge of Mount Sinai’s plans for the Beth Israel site said the parcels are not currently up for sale, so it is far too premature to discuss who might purchase the land, let alone what they might choose to build on it. That buyer will work with all appropriate government regulatory agencies to help determine what gets built, according to the source.

Under current zoning rules, the hospital’s land can typically be used for residential buildings of up to 140 feet.

The state Department of Health said its jurisdiction is limited to licensing and overseeing hospital services and does not include approving sales that involve former hospitals.

However, last week, Gov. Andrew Cuomo’s administration formally requested proposals to create affordable housing on the Brookdale University Hospital and Medical Center and the Interfaith Hospital campuses in Brooklyn.

Whatever happens on the sites, Feliciano said it will be important that public and private players work to find a compromise that benefits the surrounding communities.

“I think it would be important if maybe the city did more of an economic assessment of what the hospital closures have done … and the conversions, in terms of the land, in terms of housing,” Feliciano said. “That’s never been done and I think it’s important to do that.”