The Harborside retirement community faces Dec. 9 deadline to negotiate a sale or face possible liquidation
The Harborside in Port Washington is trying to negotiate a second sale after the first one collapsed last month. Credit: Newsday/J. Conrad Williams Jr.
The Harborside retirement community in Port Washington has until Dec. 9 to present a proposed sale agreement to a federal bankruptcy judge or face the possibility of being liquidated, a judge ordered on Wednesday.
Judge Alan S. Trust said he wants to know the identity of the would-be buyer for the bankrupt facility, the terms of the sale, how creditors will be paid and the impact on the 181 residents, whose average age is 90.
The judge also scheduled a hearing for Dec. 11 on a motion from the Office of the United States Trustee to dismiss the Chapter 11 case, which would end nearly two years of effort to reorganize The Harborside and stabilize its finances.
If the motion is approved, the facility’s assets would likely be sold off under Chapter 7 of the bankruptcy code.
Stan Yang, an attorney for the U.S. Trustee, said it’s concerned about the fees for lawyers and consultants using up The Harborside’s remaining cash, which could mean that creditors would not be paid what they are owed.
"The debtor’s financial position is deteriorating on a daily basis and the debtor appears to be accruing unpaid … administrative expenses," he wrote in an 11-page document filed in court after Wednesday's hearing. "It is unclear how long the debtor can sustain business operations or when all of the reserved [cash] funds run out."
The hearing in federal court in Central Islip produced few answers to the many questions of residents and their families.
Those questions include the identity of the two bidders that The Harborside is negotiating with, when the potential sale would close and would it be approved by state Department of Health and Department of Financial Services.
Ronnie Killcommons, who has lived at The Harborside for 14 years, attended the 30-minute hearing with family.
"This is my home, and I love living at the Amsterdam," Killcommons said in an interview, referring to the facility’s former name, the Amsterdam at Harborside. "The friendships, the community — I don’t want to lose this."
Killcommons told Newsday that she sold her Garden City home to pay the facility’s entrance fee with the understanding that upon her death the remaining funds would go to her heirs. That may not happen because of the bankruptcy filing, which is the third such filing in 10 years.
"We should be allowed to live where we put our heart and soul," said Killcommons, 86.
In the hearing, Rachel Nanes, an attorney for The Harborside, said it’s having "productive discussions" with the two bidders.
A meeting, Nanes said, will be held on Thursday between The Harborside, bondholders, unsecured creditors and the sponsoring Amsterdam Continuing Care Health System Inc. in Manhattan to attempt to reach an agreement on a sale.
"We are trying to gain a consensus around one or more of the [buyout] proposals," she said, adding that The Harborside hopes to present a final sale agreement to the judge by late December or early January.
The Harborside is trying to negotiate a second sale after the first one — valued at $104 million — collapsed last month in a regulatory dispute between the health department and the winner of last year’s court-approved auction, Life Care Services Communities LLC. Iowa-based LCS has said it is no longer interested in pursuing The Harborside.
Separately, residents and their families recently hired attorney Elizabeth Aboulafia to represent them in court.
The move follows the residents' request to Gov. Kathy Hochul that she appoint a facilitator to break the regulatory impasse between the health department and LCS, as well as work with other potential buyers.
The Harborside retirement community in Port Washington has until Dec. 9 to present a proposed sale agreement to a federal bankruptcy judge or face the possibility of being liquidated, a judge ordered on Wednesday.
Judge Alan S. Trust said he wants to know the identity of the would-be buyer for the bankrupt facility, the terms of the sale, how creditors will be paid and the impact on the 181 residents, whose average age is 90.
The judge also scheduled a hearing for Dec. 11 on a motion from the Office of the United States Trustee to dismiss the Chapter 11 case, which would end nearly two years of effort to reorganize The Harborside and stabilize its finances.
If the motion is approved, the facility’s assets would likely be sold off under Chapter 7 of the bankruptcy code.
Stan Yang, an attorney for the U.S. Trustee, said it’s concerned about the fees for lawyers and consultants using up The Harborside’s remaining cash, which could mean that creditors would not be paid what they are owed.
"The debtor’s financial position is deteriorating on a daily basis and the debtor appears to be accruing unpaid … administrative expenses," he wrote in an 11-page document filed in court after Wednesday's hearing. "It is unclear how long the debtor can sustain business operations or when all of the reserved [cash] funds run out."
The hearing in federal court in Central Islip produced few answers to the many questions of residents and their families.
Those questions include the identity of the two bidders that The Harborside is negotiating with, when the potential sale would close and would it be approved by state Department of Health and Department of Financial Services.
Ronnie Killcommons, who has lived at The Harborside for 14 years, attended the 30-minute hearing with family.
"This is my home, and I love living at the Amsterdam," Killcommons said in an interview, referring to the facility’s former name, the Amsterdam at Harborside. "The friendships, the community — I don’t want to lose this."
Killcommons told Newsday that she sold her Garden City home to pay the facility’s entrance fee with the understanding that upon her death the remaining funds would go to her heirs. That may not happen because of the bankruptcy filing, which is the third such filing in 10 years.
"We should be allowed to live where we put our heart and soul," said Killcommons, 86.
In the hearing, Rachel Nanes, an attorney for The Harborside, said it’s having "productive discussions" with the two bidders.
A meeting, Nanes said, will be held on Thursday between The Harborside, bondholders, unsecured creditors and the sponsoring Amsterdam Continuing Care Health System Inc. in Manhattan to attempt to reach an agreement on a sale.
"We are trying to gain a consensus around one or more of the [buyout] proposals," she said, adding that The Harborside hopes to present a final sale agreement to the judge by late December or early January.
The Harborside is trying to negotiate a second sale after the first one — valued at $104 million — collapsed last month in a regulatory dispute between the health department and the winner of last year’s court-approved auction, Life Care Services Communities LLC. Iowa-based LCS has said it is no longer interested in pursuing The Harborside.
Separately, residents and their families recently hired attorney Elizabeth Aboulafia to represent them in court.
The move follows the residents' request to Gov. Kathy Hochul that she appoint a facilitator to break the regulatory impasse between the health department and LCS, as well as work with other potential buyers.
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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Newsday Live Music Series: Long Island Idols Newsday Live presents a special evening of music and conversation with local singers who grabbed the national spotlight on shows like "The Voice," "America's Got Talent,""The X-Factor" and "American Idol." Newsday Senior Lifestyle Host Elisa DiStefano leads a discussion and audience Q&A as the singers discuss their TV experiences, careers and perform original songs.
