Investment 360 Plans to Acquire Deer Meadows

by San Antonio Attorney

A New Jersey-based investment firm intends to acquire the bankrupt Northeast Philadelphia’s Deer Meadows Retirement Community for $30.25 million.

Investment 360 L.L.C., of Lakewood, will make a stalking horse bid at an auction in August, based on court papers filed.

A court hearing is set for Aug. 11 by U.S. Bankruptcy Judge Eric L. Frank. The hearing will tackle a planned breakup fee that would pay $756,250 to Investment 360 if the arrangement does not push through or a greater bid comes out. The proposed acquisition deal with Investment 360 was submitted Friday.

The cut-off date of submitting contending bids from other prospective purchasers is Aug. 8.

Deer Meadows, which has 491 residents and 369 personnel when it sought Chapter 11 protection, owes around $30 million to bondholders and Beneficial Bank.

The Northeast facility failed to make bond payments starting late 2011. Discussions over a debt restructuring have been fruitless after that.

At a hearing in June, Bankruptcy Judge Eric L. Frank was disappointed because there was no agreement made within the session.

Although it has stayed current on it payments for the Beneficial loans, Beneficial has said that it is going to sell its collateral.

In 1998, Deer Meadows obtained $28.38 million in bond debt to construct a new elderly care facility that can accommodate 135 beds and then fix up the previous nursing-home area into 78 personal-care rooms.

Deer Meadows borrowed more money from Beneficial in 2003 and 2008 to make the apartments larger.

According to its website, Investment 360 was founded in 2006 and focuses in the acquisition of financially troubled nursing facilities.

Selling tax-exempt nursing homes to for-profit operators is becoming a trend.

There has been a long fight in the Deer Meadows bankruptcy over whether there will be an auction sale or a reorganization that could allow the facility to continue as an independent institution.

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