North Shore-LIJ Health System will convert St. Vincent’s O’Toole Building into a facility with emergency care as part of the agreement.

A bankruptcy court yesterday approved the sale of the shuttered St. Vincent's Medical Center in Greenwich Village.
 
The ruling paves the way for the North Shore-LIJ health-care system to open a 24-hour emergency room and ambulatory clinic in the landmarked O'Toole Building on Seventh Avenue.

The 160,000-square-foot mini-hospital, which will have no inpatient beds or trauma care, is scheduled to open in the fall of 2013.

The $260 million sale will also allow the Rudin family to build luxury apartments on the main hospital campus on the opposite side of the avenue.

The Rudin family, a New York real-estate dynasty, announced Monday that they closed on their $260 million purchase of St. Vincent’s Hospital’s main Manhattan campus. The Rudins acquired the property from the closed hospital’s Chapter 11 estate.

Completing the sale, with the assistance of Eyal Ofer’s Global Holdings, which joined the deal, allows the Rudins to move forward with renovations and redevelopment of the site that will include a health-care center with a standalone emergency room, condos, townhomes and a new elementary school.

A large hospital chain that offered to take over the nearly bankrupt St. Vincent’s Hospital in Greenwich Village has formally withdrawn its offer, further harming the hospital’s prospects for survival.

Stan Brezenoff, president of Continuum Health Partners, a consortium of five hospitals in Manhattan and Brooklyn, said in a letter to Henry J. Amoroso, the president and chief executive of St. Vincent’s, that he was withdrawing the offer because of what he said had been a negative reaction to it from both the State Health Department and St. Vincent’s own board. The letter was sent Friday but not released until Thursday.

In its offer submitted to St. Vincent’s on Jan. 22, Continuum proposed to continue running outpatient facilities for the hospital, on 12th Street and Seventh Avenue, while funneling inpatients to its own hospitals, St. Luke’s Roosevelt, on West 58th Street, and Beth Israel, on the East Side. Most emergency room and inpatient services would have been eliminated.

The hospital is $700 million in debt and needed a state loan this week to make its payroll.