Imagine losing your life savings to a retirement dream that turns into a nightmare. Harborside, a continuing-care retirement community in Port Washington, New York, has filed for bankruptcy, leaving elderly residents and their families financially stranded. This isn’t just a business failure—it’s a stark warning about the risks of entrusting wealth to poorly managed institutions.
According to the Daily Mail, Harborside’s Chapter 11 filing in October 2024, its third since opening, has wiped out millions in entrance fees paid by residents, ranging from $425,000 to $1.7 million, with many receiving only a fraction of their investment back.
Let’s rewind to 2010, when Harborside first opened its doors. The timing couldn’t have been worse, as the housing market crash made it nearly impossible for prospective residents to sell their homes and afford the hefty entrance fees.
Within two years, Harborside had filled less than 60% of its 229 independent living units. The empty halls signaled financial distress from the start, setting the stage for future failures.
The first bankruptcy came in 2014, followed by a second in 2021, exacerbated by the pandemic halting new move-ins. Fortunately, bondholder support during these filings shielded residents from immediate loss.
But the reprieve was temporary. In 2022, after defaulting on bonds again, a new owner took over and slashed care services, pushing many residents out who needed immediate or incremental care.
This reduction in services hit hard. Residents like Bob Curtis, now 88, watched loved ones suffer—his wife, Sandy, moved to a memory care facility in February 2024 and tragically died at 85 after a fall in April.
Bob remains at Harborside, hoping for a $50,000 refund this fall from his $840,000 entrance fee, with another $100,000 delayed by tangled bankruptcy proceedings. "Hope is thin" when secured creditors get paid first, often leaving little for residents.
Take Arlene Kohen, 89, who sold her Great Neck home for $838,000 to pay a $945,000 entrance fee. Her family now expects less than a third of the promised $710,000 refund.
"That's money that I'll never see," said Beverly Kohen Fried, Arlene’s daughter, capturing the despair felt by many. The betrayal stings when you’ve sacrificed everything for promised security.
Of the 210 current and former Harborside residents, 187 have accepted a Chapter 11 offer returning just 32% of their entry fees. It’s a bitter pill—monthly fees in the thousands compounded the burden. This isn’t an isolated tragedy. Since March 2020, at least 16 senior living facilities nationwide have filed for bankruptcy, erasing $190 million in savings from 1,000 families, including 212 from Harborside alone.
With nearly 2,000 similar facilities across the country, the risk isn’t just local. These bankruptcies expose a systemic flaw—residents are last in line when the money runs out, behind secured creditors.
For wealth builders and savers, this is a cautionary tale about due diligence. Before investing in senior living, scrutinize financial stability, management track records, and refund policies—your nest egg depends on it. Consider diversified investments over single, high-risk commitments.
Liberty-minded readers should question why government oversight fails to protect vulnerable citizens from such collapses. Market efficiency demands transparency, not bailouts—let failing businesses face consequences while empowering families with better information to make sound choices.