New York CIty Council Member Ben Kallos

Crain's New York Hospital for Special Surgery to revive FDR Drive project by JONATHAN LAMANTIA

Hospital for Special Surgery to revive FDR Drive project

Hospital for Special Surgery is moving ahead with a $300 million project to add patient rooms and physician offices by building above the FDR Drive. The plan is more than 10 years in the making and has been saddled with lawsuits from neighbors opposing it.

The 12-story structure, called the River Building, will be built between East 71st and East 72nd streets on a deck above the parkway. After the project, the majority of the patient rooms at the 215-bed orthopedic hospital will be private, an amenity that could reduce the chances of infection transmission. The tower will include three floors of patient rooms, office space and diagnostic imaging services.

The River Building will increase the capacity of the hospital, giving it extra space as it looks to renovate its main campus building on East 70th Street in the next few years.

"The River Building is a critical component of continuing to protect, invest in and modernize our main campus," said Louis Shapiro, the hospital's CEO. "Modernizing is sort of like trying to repave a New York City road: You need to shut down the road to pave it, and we can't do that."

 

The new physician offices will encourage greater collaboration between HSS' specialists in areas such as joint replacement and spine surgery, Shapiro added. "It allows us to bring people together who are now scattered all over the place," he said.

The hospital plans to break ground on the project within the next year and feels confident it will be able to steer clear of the neighborhood conflicts that could further delay development. Those conflicts have included lawsuits filed against the hospital and the City Planning Commission by a co-op building on East 72nd Street.

"These are the last air rights we own and have full rights to," Shapiro said. "We have full intention to construct this building."

A long time coming

HSS got approval from the city to build its East Wing over the FDR Drive in 1992. But construction of the River Building required special permits and zoning amendments, leading the hospital to file a land-use application in 2006. By the fall of 2008 the hospital had received city approval for the project, but it still hasn't broken ground.

HSS declined to answer questions about the delay.

The River Building is set to be part of a broader transformation of the hospital campus, which HSS plans to announce later this year. It declined to detail those plans.

Throughout the project's history, HSS has been fighting litigation filed by a co-op building and residents who don't want to see it built. The 119-unit Edgewater Apartments at 530 E. 72nd St., which sits adjacent to the proposed structure, first sued the hospital and the City Planning Commission in 2008; the case was dismissed in 2012. The building again sued in 2017, when HSS received a three-year renewal from the city for special permits that were set to expire.

The commission's renewal "means that a developer who obtains special privileges to build through issuance of a special permit can sit back for years before deciding to begin construction," attorneys for the co-op wrote in the 2017 complaint.

 

Opponents argued that a spate of medical construction on the Upper East Side by Memorial Sloan Kettering, New York–Presbyterian/Weill Cornell Medical Center and HSS had altered the neighborhood and invalidated the 10-year-old environmental impact statement.

The complaint mentions potential traffic and air pollution caused by trucks making deliveries as well as shadows created by the new building that would block light on the esplanade. The suit noted the open space and views that would be obstructed by the construction.

Justice Carol Edmead dismissed the case in New York Supreme Court last year and noted that Edgewater's earlier litigation against HSS and the City Planning Commission didn't end until 2013, meaning the 10-year period in which the hospital could be expected to build would run through 2023. Edgewater attorneys are appealing the ruling, and oral arguments are expected in the fall.

"Our clients are planning to vigorously contest HSS' right to put up the building they've proposed," said David Scharf, the co-op's attorney and a partner at the Morrison Cohen law firm. He acknowledged the suit could be holding up the project. "When you deal with land-use issues like this, the prevailing wisdom often is you don't want to start and have to go back to zero," he said.

HSS has found ways to keep other neighbors happy. It has worked with Councilman Ben Kallos to contribute to the stretch of the East River Esplanade in front of its campus. HSS has agreed to spend $1.8 million and contribute to the master plan for the walkway from East 70th through East 78th streets as part of a separate land-use agreement Kallos brokered in 2015.

Last year HSS finished landscaping, irrigation, lighting and noise barriers on a stretch along the East River from East 70th Street to East 72nd Street. It has agreed to maintain that area in perpetuity and serve on the board of Friends of the East River Esplanade.

 

"I think we can work with HSS to address any concerns," Kallos said of the River Building. "They've been a really good partner."

Barry Schneider, president of the East Sixties Neighborhood Association, said allowing HSS to expand is a benefit to a neighborhood with a large senior population. The Upper East Side has the second-highest rate of seniors requiring a trip to the hospital because of a fall among all city neighborhoods. "If we can give people the greatest care, we'd be remiss if we didn't do it," he said. "I'm not against growth if it's appropriate to the location and needs of the community."

The hospital also will need financing. A presentation at the J.P. Morgan Healthcare Conference in San Francisco this year showed HSS planned to fund the project through new debt and philanthropy. The presentation revealed that the hospital raised $80 million in philanthropic funding last year, including $30 million designated for the project. A broader fundraising campaign in 2017 yielded $320 million.

Staying competitive

Since 2012 HSS has increased its presence beyond the Upper East Side. It has locations in Queens; Long Island; Westchester; Stamford, Conn.; and Paramus, N.J. This year it will open an office in Hudson Yards, with plans for another in Brooklyn.

HSS' local expansion runs in tandem with its strategy to become an international destination for orthopedic care as patients show they will travel to get quality care.

It has teamed with Tenet Healthcare and United Surgical Partners for a location in West Palm Beach that will include ambulatory surgery, physical therapy, sports medicine and imaging. It also set up a partnership with Aspen Valley Hospital in Colorado this year.

 

The plan is to recruit physicians to open offices under the HSS name, rather than acquiring existing practices, so that it can bring its philosophy and protocols into new facilities, Shapiro said.

As HSS branches out, it must ensure its main campus is up-to-date by focusing on projects such as the River Building. Shapiro's call for more private rooms comes as NYU Langone Health recently opened a $1.4 billion tower in Manhattan with all single-bed rooms. Northwell Health is planning a $2.5 billion reconfiguration of Lenox Hill Hospital with all private rooms.

Northwell partnered with Philadelphia-based Rothman Orthopaedic Institute, an HSS rival in the area, on two Manhattan offices. Knowing New York–Presbyterian, Mount Sinai and NYU Langone are all close by, HSS looks to attract patients with upgrades.

"Priority No. 1 is continuing to ensure we earn our leadership position in the tristate area and deliver high-value care closer and closer to where people live and work," Shapiro said.

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