Port Washington’s retirement community, The Harborside, could be taken over by Life Care Services Communities, the third-largest manager of retirement communities in the nation, according to court documents.
Judge Alan Trust of the U.S. Bankruptcy Court in the Eastern District approved the sale of the financially unstable community to Life Care Services, otherwise known as LCS, in late December after the Des Moine-based company won an auction for the 329-unit development earlier this year.
In March 2023, The Harborside–previously known as The Amsterdam at Harborside–filed for bankruptcy protection from its creditors under Chapter 11 for the third time in nine years because of a decline in residents. The company blamed the lower occupancy numbers, which reduced needed revenues to pay the facility’s bills, on the stigma associated with its earlier bankruptcy filings and the COVID-19 pandemic.
The LCS bid of $63 million was determined by the judge to be the least disruptive to current residents over at least two other undisclosed bids, one of them for $178 million that would have shut down the complex. Kansas City, Missouri-based UMB Bank N.A., the holder of millions of dollars of Harborside debt, filed an appeal of Trust’s ruling, according to court documents.
The Harborside, which opened in 2010, is located on 8.9 acres, providing residential units and a diversity of care and amenities. Units are either one or two bedrooms, including weekly housekeeping services. The community includes a library, fitness center, art studio and beauty salon and barbershop.
The senior facility’s care services include assisted living, memory support, skilled nursing, hospice care and rehabilitation.
Trust said in a Dec. 1 hearing the court weighed the competing bids and did not just pick the highest one. Some 100 Harborside residents also signed a petition weeks ahead of Trust’s decision for the court to accept the LCS bid.
“In the context of a sale process that generates more than one bid, the bid that is objectively the highest may not also be subjectively the best bid,” Trust said, according to court documents.
Trust went on to say that the other bids would have displaced residents–who are an average age of 90 years old–and caused many of them to lose life savings and “life-sustaining health care.”
“The LCS bid is the only qualified bid that proposes to continue,” Trust said. “The Harborside is a [Continuing Care Retirement Community] within the same community near the residents’ homes and friends.”
The sale terms–which need to be finalized by the Nassau County Industrial Development Agency–include LCS paying $63 million to bondholders through UMB Bank and refunds to families of Harborside residents who have died, according to documents. LCS will also pay $1.2 million to cover Harborside’s operating losses until the sale is finalized, according to the documents.
