Buyers express interest in The Harborside as its lawyer says a Dec. 31 closure won't happen
The Harborside is weighing offers from "several parties" to purchase the bankrupt retirement community in Port Washington. Credit: Newsday/Howard Schnapp
The Harborside is weighing offers from "several parties" to purchase the bankrupt retirement community after an earlier sale collapsed, raising the possibility of closure by year-end, an attorney said on Wednesday.
Rachel Nanes, speaking to a bankruptcy court judge, said the Port Washington facility would not close on Dec. 31, thanks to a $1.25 million grant from the Amsterdam Continuing Care Health System Inc. Amsterdam, which runs a nursing home in Manhattan with the same name, built The Harborside in 2008-09.
The Harborside "will be no worse off at the end of the year than we are now. We aren’t going down to zero [in terms of the available cash]," Nanes said, adding that it could take until January to finalize a sale of the property.
At last month’s "Save Our Homes" rally, the facility’s residents, whose average age is 90, said they had been told it would shut down by the year's end and that they would have to find alternative accommodations, if a sale transaction wasn’t forthcoming.
The Harborside has filed for Chapter 11 bankruptcy protection from its creditors three times in the past 10 years. It is home to 181 people.
On Wednesday, Nanes didn’t disclose the identities of the would-be buyers but said "several term sheets had been received" with details of sale proposals. The Harborside’s management team hopes to select a bidder by Nov. 15, she said.
"In the last week or so, there’s been a lot of engagement with the top bidders. ... These conversations have been very productive," Nanes said during the hybrid conference meeting. "We still have a little bit more to do on the bids but hope to get to a conclusion in short order."
She and others noted the new sale process follows a $104 million sale agreement approved by the bankruptcy court in December 2023 that unraveled last month in a dispute between a state regulator, the Department of Health, and the prospective buyer, Life Care Services Communities LLC in Iowa. The latter has said repeatedly it is no longer interested in owning The Harborside.
One of the new bidders, Kong Capital LLC, also participated in last year’s court-supervised auction in which it competed with LCS and another entity.
Coe Schlicher, CEO of Austin, Texas-based Kong, said it’s offering $20 million for The Harborside and would charge monthly rent to the residents, who have already paid hundreds of thousands of dollars in entrance fees.
Prospective residents often sell their homes to pay The Harborside’s entrance fee, which is determined by the size of the apartment. A portion of the entrance fee, between $527,250 and $2.2 million under one type of sales contract offered in 2021, is supposed to be refunded after a resident dies.
"The situation facing The Harborside’s residents is a potentially devastating one, and we have crafted our bid to ensure their safety, stability and well-being," Schlicher wrote on Monday in a letter to U.S. Bankruptcy Judge Alan S. Trust.
In court on Wednesday, the judge questioned whether The Harborside’s bondholders, unsecured creditors, the Amsterdam and others have agreed to the process for selecting a new buyer.
Daniel S. Bleck, an attorney for UMB Bank, which represents the bondholders, said they had received information about the new bidders.
"There are questions about the validity of some of the offers. I cannot say today that we have agreed to the process going forward," he said at the 45-minute conference.
Separately, the judge approved a settlement between The Harborside and its food services provider Sodexo Inc. for meals to continue through at least the end of this month.
Under the deal, Sodexo received a payment of $712,983 toward unpaid bills totaling $1.25 million. The money came from the Amsterdam grant, according to Nanes, The Harborside lawyer.
The Harborside is weighing offers from "several parties" to purchase the bankrupt retirement community after an earlier sale collapsed, raising the possibility of closure by year-end, an attorney said on Wednesday.
Rachel Nanes, speaking to a bankruptcy court judge, said the Port Washington facility would not close on Dec. 31, thanks to a $1.25 million grant from the Amsterdam Continuing Care Health System Inc. Amsterdam, which runs a nursing home in Manhattan with the same name, built The Harborside in 2008-09.
The Harborside "will be no worse off at the end of the year than we are now. We aren’t going down to zero [in terms of the available cash]," Nanes said, adding that it could take until January to finalize a sale of the property.
At last month’s "Save Our Homes" rally, the facility’s residents, whose average age is 90, said they had been told it would shut down by the year's end and that they would have to find alternative accommodations, if a sale transaction wasn’t forthcoming.
WHAT NEWSDAY FOUND
- New buyers for The Harborside retirement community have come forward, and one will be selected by Nov. 15, according to the facility's attorney, Rachel Nanes.
- Nanes told a bankruptcy court judge on Wednesday that The Harborside wouldn't run out of money by year-end, so the 181 residents don't face eviction.
- A judge approved a settlement between The Harborside and its food services provider Sodexo Inc. for meals to continue through at least the end of this month.
The Harborside has filed for Chapter 11 bankruptcy protection from its creditors three times in the past 10 years. It is home to 181 people.
On Wednesday, Nanes didn’t disclose the identities of the would-be buyers but said "several term sheets had been received" with details of sale proposals. The Harborside’s management team hopes to select a bidder by Nov. 15, she said.
"In the last week or so, there’s been a lot of engagement with the top bidders. ... These conversations have been very productive," Nanes said during the hybrid conference meeting. "We still have a little bit more to do on the bids but hope to get to a conclusion in short order."
She and others noted the new sale process follows a $104 million sale agreement approved by the bankruptcy court in December 2023 that unraveled last month in a dispute between a state regulator, the Department of Health, and the prospective buyer, Life Care Services Communities LLC in Iowa. The latter has said repeatedly it is no longer interested in owning The Harborside.
One of the new bidders, Kong Capital LLC, also participated in last year’s court-supervised auction in which it competed with LCS and another entity.
Coe Schlicher, CEO of Austin, Texas-based Kong, said it’s offering $20 million for The Harborside and would charge monthly rent to the residents, who have already paid hundreds of thousands of dollars in entrance fees.
Prospective residents often sell their homes to pay The Harborside’s entrance fee, which is determined by the size of the apartment. A portion of the entrance fee, between $527,250 and $2.2 million under one type of sales contract offered in 2021, is supposed to be refunded after a resident dies.
"The situation facing The Harborside’s residents is a potentially devastating one, and we have crafted our bid to ensure their safety, stability and well-being," Schlicher wrote on Monday in a letter to U.S. Bankruptcy Judge Alan S. Trust.
In court on Wednesday, the judge questioned whether The Harborside’s bondholders, unsecured creditors, the Amsterdam and others have agreed to the process for selecting a new buyer.
Daniel S. Bleck, an attorney for UMB Bank, which represents the bondholders, said they had received information about the new bidders.
"There are questions about the validity of some of the offers. I cannot say today that we have agreed to the process going forward," he said at the 45-minute conference.
Separately, the judge approved a settlement between The Harborside and its food services provider Sodexo Inc. for meals to continue through at least the end of this month.
Under the deal, Sodexo received a payment of $712,983 toward unpaid bills totaling $1.25 million. The money came from the Amsterdam grant, according to Nanes, The Harborside lawyer.
James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.
Updated 25 minutes ago More rain for LI ... Thanksgiving travel ... Penny trial continues ... FeedMe: Holiday pies
Updated 25 minutes ago More rain for LI ... Thanksgiving travel ... Penny trial continues ... FeedMe: Holiday pies
