Bracebridge Villa in receivership with $6.4 million in reported debt
December 12, 2012
With outstanding debts that appear to be over $6.4 million, the Bracebridge Villa retirement home has been placed under receivership.
News of the arrangement was announced on Friday, Nov. 7 by BDO Canada – the court-appointed company which is now serving as receiver for the residence. On Monday, Dec. 10, BDO Canada senior vice-president Douglas Jones said the previous owner’s secured debt consisted of four mortgages against the property, located at 690 Hwy 118 W.
“This is the value per the company’s records, and has not been verified by the receiver,” he said in an email to this newspaper. “As a result, the balance may change once the creditors file proofs of claim, and the receiver is able to verify the claims.”
On the same day, the notice and statement of the receiver was sent to all the home’s creditors.
BDO Canada representatives had held a special meeting with residents and their families just three days prior, where vice-president Stella Millis said the previous owner Stephen Bordo “did not go bankrupt,” but said she couldn’t elaborate further on the specific details behind why the home fell into receivership. She did, however, say it was a process “initiated by the secured creditor.”
She said the 90-suite home is currently sitting between 60 and 70 per cent occupancy, and that the receiver is working to increase the occupancy rate as much as possible.
“If you don’t have a home that’s fully occupied, it’s obviously not going to be as profitable, so the ultimate goal is always to have a home as occupied as you can,” she said.
BDO Canada regional business development manager Stephen Jones said the receivership process does not necessarily mean the previous owner was bankrupt.
“That is the normal thought process involved in it, but for the secured creditor to execute their right by the law, they have an ability to do that based on their relationship, it does not mean the facility is bankrupt or approximating that,” he said.
Jones and Millis assured residents and their families that the facility will not be closing and they do not need to start looking for new homes.
“We’re retaining the existing staff, and the only change really that you’re seeing is a change of management, and we’re going to be maintaining services and seeing where we can improve them,” said Millis.
BDO will be managing Bracebridge Villa with the goal of eventually finding a buyer for the property. It has appointed Autumnwood Mature Lifestyles Communities Inc. to look after the home on a day-to-day basis. The Sudbury-based company currently manages four other retirement residences.
“Someone from BDO will be here every day until we’re assured that everything is running smoothly. We’ve addressed all safety concerns (and) we’ve transitioned,” said Millis, who added that the process can take a number of months.
Millis said pay of employees has not been affected.
“Employees have been paid, there’s been no issues there,” she said. “We don’t plan on making any changes, the court order says everything remains status quo with the employees, so we don’t come in and start changing their salaries or doing anything like that.”
A number of questions about the home’s condition were also brought up during the meeting with residents. When asked by this newspaper, one woman with a family member at the home – who didn’t want to be named – said residents went about four days in November without hot water when a boiler broke. A few days after that, she said residents ate off paper plates for “a day or so” when a dishwasher needed replacing. Similar concerns were voiced to this newspaper in early November from another anonymous complainant.
However, she said her family member at the home had no complaints.
“This is the cheapest place around,” she said. “We’re happy because she’s happy; she doesn’t have any complaints.”
The dishwasher, she said, was replaced promptly, and the boiler was fixed within the week. Millis said the new management is currently working to replace the boiler entirely, and Autumnwood administrator Ann Afonso said the new management will be sizing up the home with assessments in the coming months.
“I’m speaking with staff and I’m observing and looking at everything from equipment and supplies that we have here,” she said. “We’re just going to look at inefficiencies and see how we can make changes to be more efficient.”
Millis echoed Afonso’s comments on improvements during receivership.
“Our court order authorizes the receiver to borrow up to $250,000, it’s a public document, so we are going to borrow what we think is necessary to make the improvements,” she said.
The Retirement Homes Regulatory Authority’s public register shows that an application for a licence was submitted by the home and has been received, but does not list any inspection reports or other licence information. Under new rules this year, the provincial government decreed that all retirement homes in Ontario needed to apply for a licence with the regulatory authority by July 3.
“There’s potentially a backlog on that end, they’ll notify us as we come up with that process,” said Millis.
Millis said fire exits and fire escape plans have all been approved by the Ontario Fire Marshal’s office, though she said residents still have some concerns. The regulatory authority’s public register shows that none of the suites are equipped with automatic sprinkler systems. However, residents at the home did take part in a mock evacuation exercise with the Bracebridge Fire Department earlier this year.
“Meeting standards and perhaps surpassing them are two different things, so as part of this assessment process it might not be good enough just to meet standards, we want to be making sure that all safety concerns are in place for the lifestyle aspects of the residents as well,” said Jones.
In a statement given to attendees of the Friday meeting, BDO Canada has reassured residents that rent will not be increasing for the time being, and that it is working with Autumnwood to get feedback from residents about how to improve the facility.
“The take-home message is we know it’s a very upsetting time. It is going to be business as usual, and hopefully we’ve done our jobs if you don’t really notice any changes in terms of day-to-day turmoil,” said Jones. “You will notice changes when it comes to improvements in health and safety, and do know that you can bring your concerns to us at any time.”
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