Life Care Services Communities wasn’t the top bidder for a retirement complex in Port Washington, but it won the auction. It just won’t buy the place.
Iowa-based LCS terminated a $104 million sale agreement for the Harborside community in the Long Island hamlet, Newsday reported. The termination of the deal comes months after LCS won an auction over a higher bidder specifically because it wouldn’t shutter the facility or disrupt residents.
Disruption has come anyway.
The failed deal appears to be the result of a regulatory fight. Officials from LCS claim they’ve waited nine months for required approvals from New York state regulators, to no avail. The Department of Health, meanwhile, reportedly turned down the sale because the buyer did not provide enough information to the agency.
Part of the issue appears to be transitioning LCS from a nonprofit to for-profit operator in the state.
Under the agreement, LCS — one of the nation’s largest retirement home operators — said it would keep all of the facility’s employees, pay off investor-held bonds and refund families of deceased residents. It also planned to inject more than $1 million into operations while the deal was under review.
With LCS backing out, the community’s 181 residents (who have an average age of 90) are in distress. Many of the residents sell their homes to afford the entrance fee to Harborside, which was as high as $2.2 million in 2021; part of it is refunded when a resident dies.
But finances are getting tight at Harborside, which is in the midst of its third Chapter 11 bankruptcy filing in the last decade. An attorney for the facility said it had a “limited liquidity runway.”
“The Department of Health has had multiple chances to keep this community open,” a spokesperson for LCS said. “They have failed the residents of the Harborside, who now face an uncertain future.”
A spokesperson for Gov. Kathy Hochul said the state would work with families to make sure everyone had a home and proper care.
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