Food service provider wants to pull out of the bankrupt Harborside retirement community in Port Washington
Sodexo claimed in a court filing that The Harborside is overdue on bills.
Credit: Howard Schnapp
The provider of food services for a bankrupt retirement community in Port Washington wants to walk away, citing more than $1 million in unpaid bills, according to court documents.
Sodexo Inc. has requested permission from a federal bankruptcy judge to end its dining services at The Harborside, which is home to 181 senior citizens with an average age of 90.
Sodexo’s "services are essential to the [Harborside’s] operations and the well-being of its residents," said Laurie Shinaman, Sodexo’s senior director of finance for its seniors business unit.
But the retirement community "is very frequently overdue on both pre-bill and reconciliation invoices and regularly incurs contractual interest charges," she said in a court filing.
Sodexo’s contract to provide food services, which dates to February 2018, was to end last month when The Harborside was to be sold to Life Care Services Communities LLC for $104 million.
However, as Newsday reported on Oct. 8, that deal fell apart after state regulators turned down the approval application because of a lack of information provided by Iowa-based LCS.
In response, LCS executives said they were no longer interested in owning The Harborside after waiting more than nine months for the state Department of Health and Department of Financial Services to review the deal and explain what additional information was needed.
"Sodexo is facing the prospect of being expected to continue to provide vital goods and services to the [Harborside] and its residents ... without assurances — other than perhaps verbal statements from the [Harborside and its attorneys] — that Sodexo will be paid," said Sodexo attorney Edward E. Neiger in a 15-page court filing.
U.S. Bankruptcy Judge Alan S. Trust has scheduled a hearing on the matter for Nov. 6 in Brooklyn federal court. The retirement community filed for Chapter 11 bankruptcy protection from its creditors in September 2023, the third such filing in 10 years.
Should the judge approve ending the food service contract, it’s unclear what would happen to the 66 Sodexo employees at The Harborside. They were expected to be hired by LCS once it assumed ownership of the upscale facility.
Sodexo spokeswoman Katherine Power declined to answer Newsday’s questions this week, saying the company "does not comment on active legal cases."
The Harborside has 329 units and offers different levels of care as residents age, from independent- and assisted-living apartments to a nursing home and dementia care. It is one of four "continuing care retirement communities" on Long Island.
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, which was between $527,250 and $2.2 million under one type of sales contract offered in 2021, is supposed to be refunded after the resident dies.
The provider of food services for a bankrupt retirement community in Port Washington wants to walk away, citing more than $1 million in unpaid bills, according to court documents.
Sodexo Inc. has requested permission from a federal bankruptcy judge to end its dining services at The Harborside, which is home to 181 senior citizens with an average age of 90.
Sodexo’s "services are essential to the [Harborside’s] operations and the well-being of its residents," said Laurie Shinaman, Sodexo’s senior director of finance for its seniors business unit.
But the retirement community "is very frequently overdue on both pre-bill and reconciliation invoices and regularly incurs contractual interest charges," she said in a court filing.
Sodexo’s contract to provide food services, which dates to February 2018, was to end last month when The Harborside was to be sold to Life Care Services Communities LLC for $104 million.
However, as Newsday reported on Oct. 8, that deal fell apart after state regulators turned down the approval application because of a lack of information provided by Iowa-based LCS.
In response, LCS executives said they were no longer interested in owning The Harborside after waiting more than nine months for the state Department of Health and Department of Financial Services to review the deal and explain what additional information was needed.
"Sodexo is facing the prospect of being expected to continue to provide vital goods and services to the [Harborside] and its residents ... without assurances — other than perhaps verbal statements from the [Harborside and its attorneys] — that Sodexo will be paid," said Sodexo attorney Edward E. Neiger in a 15-page court filing.
U.S. Bankruptcy Judge Alan S. Trust has scheduled a hearing on the matter for Nov. 6 in Brooklyn federal court. The retirement community filed for Chapter 11 bankruptcy protection from its creditors in September 2023, the third such filing in 10 years.
Should the judge approve ending the food service contract, it’s unclear what would happen to the 66 Sodexo employees at The Harborside. They were expected to be hired by LCS once it assumed ownership of the upscale facility.
Sodexo spokeswoman Katherine Power declined to answer Newsday’s questions this week, saying the company "does not comment on active legal cases."
The Harborside has 329 units and offers different levels of care as residents age, from independent- and assisted-living apartments to a nursing home and dementia care. It is one of four "continuing care retirement communities" on Long Island.
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, which was between $527,250 and $2.2 million under one type of sales contract offered in 2021, is supposed to be refunded after the resident dies.
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.
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