Harborside Port Washington Facility to Be Sold for $86 Million

By Rupert Deedes

A federal bankruptcy judge has approved the $86 million sale of The Harborside, the deeply-troubled senior continuing care retirement community (CCRC) in Port Washington.

The Buyer is a Chicago-based private equity firm Focus Healthcare Partners LLC. Focus owns some 15 senior living and health-care properties across the US.

The $86 million purchase price is going to leave residents short: Residents and residents’ heirs are owed approximately $130 million in entrance fee refunds, but due to the bankruptcy proceedings, only $43 million will be available for refunds, so residents and their families are expected to only recover between 25% and 33% of their deposits and refund fees.

The residents and heirs are expected to receive an initial $6 million distribution after the sale, and will also get additional distributions of $36 million, over the next two years, after the senior home’s affiliate, Amsterdam Nursing Home Corp., sells its skilled-nursing facility on New York City’s Upper West Side.

The residents were promised as much as 90% of the entrance fee refunded if they moved or died, but the facility’s bankruptcy voided those contracts.

The sale of the 329-unit continuing-care retirement community includes the closure of The Harborside's health center, which encompasses assisted living, memory care, and nursing home units.

Residents in these units are being assisted in relocating to other facilities, with a closure deadline set for March 14, 2025. 

Residents in independent living units can remain in their apartments under new rental agreements. However, they will lose a significant portion of their entrance fee refunds and the benefits associated with life-care contracts. 

Bondholders, owed approximately $168 million, will receive $73 million upon the completion of the sale, and an additional $8.8 million, plus 7.5% interest per year, from Amsterdam Continuing Care Health System Inc., The Harborside's parent company.

Bondholders, unlike residents, own "secured" debt, which bankruptcy law puts ahead of entrance fees from seniors and their families.  Residents' deposits and fees are treated as lower ranking "unsecured" debt.

This sale reflects broader challenges within the senior living industry, especially concerning financial stability and resident security.

Harborside, which opened in 2010, has faced mounting difficulties it could not overcome, including pandemic restrictions, labor shortages, soaring wages, supply costs, and slumping occupancy. 

Harborside is among the more than 16 CCRCs that filed for bankruptcy over the past four (4) years.