Port Washington Retirement Community Secures $ 40 Million New Bond Funding
A financially struggling upscale retiree community in Port Washington has secured $ 40.7 million in taxable bonds through the Nassau County Industrial Development Agency, which said it acted to protect residents aged of the establishment.
In addition to issuing the new bonds for the Amsterdam at Harborside, IDA also issued $ 127.3 million in tax-exempt bonds for the facility, as part of a restructuring of its previous debt. . The establishment is non-profit
The new funding, along with $ 18 million from its parent company, will allow the facility to fully recover from its financial woes, Amsterdam said in a press release earlier this month. The parent company, Amsterdam Continuing Care Health System Inc., also operates a nursing home in Manhattan called Amsterdam.
“It’s a great relief,” said Brooke Navarre, executive director of the Port Washington facility. âIt gives my residents peace of mind, they feel more secure nowâ¦ Now we can just start moving forward into the future. “
Amsterdam is planning renovations to its dining room and lobby, and offers a wider range of contract options for residents, including lower-cost options that should increase the pool of applicants, Navarre said. âWe’ve thought about it a lot and we’ve come up with a really good long term plan,â she said.
Declared bankruptcy twice
In June, Amsterdam at Harborside filed for bankruptcy for the second time in seven years. His reorganization plan was approved last month by the US bankruptcy court in Central Islip.
âWe have worked hard with our stakeholders to restructure our debt,â said James Davis, president and CEO of the facility’s parent company, in a statement. “This refinancing and new money will provide us with strong cash flow and get us completely back on track financially.”
The IDA served as an intermediary for the bonds. Investors hold the bonds and payments to investors are funded by the income from the facility, IDA officials said. The agency is not “responsible” for the debt, IDA President Richard Kessel said Thursday.
The agency acted to protect elderly residents of Amsterdam at Harborside, their families and facility workers, he said. Amsterdam has more than 375 inhabitants and employs more than 200 people, the establishment said.
âAlthough the facility had significant financial problemsâ¦ it was very important for us to keep these residents there,â Kessel said. “There were many who were afraid of being moved.”
Kessel said IDA requires the facility to provide quarterly reports on its finances. IDA did not consider asking for leadership changes in Amsterdam, he said. “It’s not our role at all,” he said. “By requiring them to report on a quarterly basis, that is enough for me to be able to monitor the situation.”
Amsterdam owed more than $ 20 million in reimbursement of entrance fees to 33 families of deceased residents. All of these refunds are paid in full, Navarre said.
Prospective residents often sell their homes to pay for the Amsterdam entrance fee, which ranges from $ 527,250 to $ 2.2 million, depending on the size of the housing unit. Residents also pay a monthly service charge of $ 2,600 to $ 8,100 for meals and amenities, such as a heated indoor pool and underground parking, according to bankruptcy court documents.
In bankruptcy court records, Amsterdam said the COVID-19 pandemic had disrupted sales.
Kessel said the facility acknowledged to IDA that it had also encountered difficulties before the pandemic. âThey certainly admitted to us that there were financial problems that were exacerbated by COVID,â he said.
IDA still has concerns about the facility’s finances, but it has acted in the best interests of residents, Kessel said.
Without IDA’s help, Kessel said, the facility “could have closed or relocated residents, it would have been a crisis there … It would have had an extremely negative impact on residents and staff.”