Deal to Save Cabrini Center Is Off the Table

CabriniStephen Rex Brown

The new owner of the building that houses Cabrini Center for Nursing and Rehabilitation has failed to come to terms with a  potential new operator of the nursing home, increasing the likelihood that it will close when its lease expires in April.

Kenneth Fisher, an attorney representing Magnum Real Estate Group, which bought the building at Avenue B and Fifth Street late last year, said that negotiations to resell the building to a for-profit nursing home operator fell apart earlier this week. “On Sunday, we believed there was an agreement on the price,” he said. “On Tuesday, they had walked back from the agreement.” He added, “We’re disappointed that the transaction wasn’t reduced to a written contract.”

Michele deMilly, a consultant for Cabrini who is authorized to speak for the company, confirmed that a deal is no longer in the works: “Yesterday we heard that Magnum, meaning Ben Shaoul, was no longer negotiating with the prospective new operator of the nursing home facility on that site – he had terminated all negotiations –  and that Cabrini was going to proceed with their closing plan.”

The elder-care center, she said, had already fulfilled its obligation to inform the State Department of Health of its imminent closing, but has not yet sent a formal notice to employees. “Frankly, we’re not quite there yet,” she said. “We’re still holding out hope that these parties will get together and save the beds.” Ms. deMilly added that she will soon relay the news to elected officials and others who’ve been fighting to keep the nursing home in the neighborhood.

Mr. Fisher said his client remained “very willing to consider an alternative strategy” to keep elder-care beds in the building, but was not confident that the recently in-the-works deal could be salvaged. “The operator knows what the price is and what the terms are,” he said. “I can’t say how we would respond if those terms were in fact met, because they haven’t been up until now. What I can say is that in the absence of an agreement, we expect Cabrini to move forward with the appropriate preparations [for closure].”

In November, The Local reported that the residence for low-income seniors was in danger of closing due to the sale of its building, which went for $25.5 million. On Dec. 28, Mr. Fisher sent a letter to politicians indicating that the building’s buyer, Magnum Real Estate Group, was negotiating to resell the building to a still unnamed operator that, at the same time, was negotiating with Cabrini to purchase the nursing home’s certificate of operation.

It’s uncertain whether the potential operator is still in negotiations with Cabrini. If it purchased the operating certificate from Cabrini without buying the building from Magnum, it could move the nursing home’s beds to a new location. Ms. deMilly said, “I’m not aware of anyone having bought the certificate.”

Magnum has not revealed its exact plans for the property, but they likely don’t involve elder care. “The property was purchased for redevelopment as an as-of-right project,” said Mr. Fisher. “Our financing is in place and, absent some circumstances that we can’t predict, we intend to proceed.”

Benjamin Shaoul’s Magnum Real Estate Group was in the news on Tuesday after the Department of Buildings approved a rooftop addition to the company’s building at 315 East 10th Street just hours before the Landmarks Preservation Commission voted to designate the block a historic district. State Senator Daniel Squadron has taken an interest in developments at that address as well as in the fate of Cabrini.