During his lifetime, Ivo Shandor lived in a large castle on an island (newly named Shandor Island) in the Hudson River near Liberty Island where he conducted rituals with his cult. When he died, Shandor bound the island as a Mandala node and rigged it to sink into the river.
The Shandors have owned the island for generations. A castle was built on it in the 1860s. Ivo Shandor used it as a refuge, lab, and temple for the Cult to worship Gozer.  He consecrated the island to Gozer. The island had many features that were all constructed by Shandor but the most infamous was a Slime Laboratories in the lower levels that produced the vile substance in mass quantities known as Black Slime and refined it into the other varieties of Psychomagnetheric Slime, effectively acting as the source of the River of Slime. On the night the last Shandor died, Ghostworld reclaimed it. A huge tidal surge swallowed it up. 
After sealing off the Library, Museum, and Hotel Sedgewick nodes, the Ghostbusters followed the coordinates of the last node to the Hudson River where Shandor's island mansion rose again out of the depths. While Ray stayed behind on the Ecto-8 boat in case of a quick getaway, Peter, Egon, Winston, and the Rookie explored the sinister mansion and encountered many spectral monsters guarding the various hallways and chambers.
It was determined that the island and castle remains intact due to ethereal stability induced by sheer focused concentration of posthumous will. And it definitely appears to be sitting directly on a cross-dimensional portal. 
The Ghostbusters finally arrived at the mandala node and while attempting to sabotage it, an Imprisoned Juvenile Sloar (Black Slime Behemoth in the stylized version) appeared out of black slime and attacked them. Fortunately the Ghostbusters destroyed the monster and the node but had to make a quick getaway to the Ecto-8 as the island disappeared back into the river, for good.
The Harbor Patrol sighted the rise and fall of Shandor Island. Before acting, they knew better and left a message on the Ghostbusters' answering machine.
Places on Shandor Island
- On page 55 and 57 of the October 8, 2007 third draft of the revised cut-scene script:
- Shandor Island is located near Liberty Island, as evidenced by a view of the Statue of Liberty on the walkway between the docks and the ramparts and when the Ghostbusters vacate the island. 
- The fallen state of the island, as well as the unusual architecture of the manor and its supernatural elements, are reminiscent of R'lyeh, the unearthly sea dwelling of Cthulhu and his spawn, from H. P. Lovecraft's novella "The Call of Cthulhu". This is paralleled somewhat by the presence of the Juvenile Sloar in the manor's inner sanctum.
- After Lost Island Rising, a sergeant from Harbor Patrol leaves the last message on the answering machine asking what happened to Shandor Island. 
- On page 19, panel 2, of Ghostbusters Annual 2015, left of Egon and under the parabola is "Lost Island Rising." This is the name of the level that takes place on Shandor Island in Ghostbusters: The Video Game.
- Zuur Platten, John & Dille, Flint (2007). Ghostbusters: The Video Game (Revised Cut-Scene Script Third Draft October 8, 2007) (Script p. 55). Peter Venkman says: "That's either a ghost island, or some new Trump Resort.""
- Zuur Platten, John & Dille, Flint (2007). Ghostbusters: The Video Game (Revised Cut-Scene Script Third Draft October 8, 2007) (Script p. 55). Line reads: "Like the Island, a GHOSTLY BRIDGE rises from the water, its entrance making landfall literally right at their feet.""
- Zuur Platten, John & Dille, Flint (2007). Ghostbusters: The Video Game (Revised Cut-Scene Script Third Draft October 8, 2007) (Script p. 57). Line reads: "The Ghostbusters step through the chaos and destruction following the defeat of the Man-Servant.""
- Lost Island Rising, Screen Grab from last cutscene
- Sergeant Gloman; After Lost Island Rising, Firehouse 2nd Floor Answering Machine Message 8 of 8 (2009). Ghostbusters: The Video Game (Realistic Versions) - Firehouse (2009) (PC/PS3/Xbox 360). Terminal Reality. Sergeant Gloman says: "Ah, Sergeant Gloman down at Harbor Patrol. Okay, so there wasn't an island in the Hudson. Then there was. Then there wasn't. So, guess who I'm calling first?"