A deal to keep open an upscale continuing care retirement / life plan community on Long Island has fallen apart after the New York Department of Health turned down the proposed sale to Life Care Services due to lack of information from the buyer.
Back in late December, Chief Judge Alan S. Trust of the Eastern District of New York in Central Islip had approved the sale of The Harborside, in Port Washington, NY, to LCS for $63 million after the CCRC had filed for bankruptcy protection for the third time in nine years in 2023. The Harborside formerly was named Amsterdam of Harborside.
According to court records, LCS withdrew the sale in September, saying the state took too long to review its application.
LCS spokeswoman Traci McBee told the McKnight’s Business Daily that the company had been working since 2022 to purchase the CCRC out of bankruptcy and “restore it to a thriving senior living option for current and future residents.”
“Ten months ago, after a complex and contentious process, we received approval from the bankruptcy court to buy the Harborside as part of a transaction designed to stabilize the Harborside’s tumultuous financial history,”McBee said. “Since then, we have diligently pursued finalizing the purchase of this community with state regulators and invested significant resources, including providing operating funds to the Harborside, in good faith to keep this community open for residents and employees.”
She said, however, that “state regulators failed to provide the necessary approvals in a timely manner, even with LCS granting multiple extensions of the outside date in the purchase agreement.”
As of the beginning of this month, McBee said, the company still was no closer to approval from the state Health Department than it was when the sale was approved.
“As a result, we can no longer continue our pursuit of the Harborside,” she said.
A spokesperson for the state Health Department told the McKnight’s Business Daily that its decision was “in keeping with its regulatory responsibility” and that it was protecting the CCRC’s residents “by denying an applicant who was unwilling to comply with instructions on how to bring the application in compliance with state law. As regulator, we’ll continue working with the existing operator to ensure that the needs and concerns of residents and their families are addressed.”
LCS takes a different view.
“The Department of Health has had multiple chances to engage with us and navigate the approval process on time to keep this community open for residents and employees. Now that the purchase agreement has expired, the department is looking to shift blame through a false narrative about incomplete applications and refusals to provide information — nothing could be further from the truth,” McBee said. “Instead, the DOH has failed the residents of the Harborside, who now face an uncertain future. We are deeply disappointed by this result, as we looked forward to improving this community for the residents, employees and the greater Nassau County community.”
The leaders of LeadingAge New York and seven CCRCs in the Empire State urged state officials in a Sept. 6 letter to work with LCS to approve the sale. The organizations asserted that a failure to move forward would have “widespread ripple effects” across the state and “could compromise the financial stability of every CCRC in the state and the investments of their residents.”
