As the Edgemere luxury retirement community in North Dallas teeters on bankruptcy, families of residents say they are worried their loved ones’ deposits won’t be returned.
Edgemere has been on the brink of financial ruin due to falling occupancy rates and its landlord and lenders demanding long-delayed payments. The retirement community has been plagued with financial troubles since October when a delayed payment agreement with its landlord and bondholders expired, according to the Dallas Morning News.
“Edgemere was the only place Dad would go,’’ said Jay Thomas, daughter of late resident John Stallings. “He knew it was nice.”
Stallings put down a deposit of $326,012 to reserve a spot in what was once called the “Ritz-Carlton of senior living.” Approximately, 90 percent of that deposit –$293,411– is supposed to be refunded to him or his estate when he moved out or died, according to a copy of the contract obtained by the newspaper.
It’s been almost three years since Stallings moved out and over two years since he died, and the family still has not received its deposit back. Stallings intended his refund to be an inheritance for his three granddaughters, said Thomas and her husband, William.
The Thomases said they contacted Edgemere management many times but didn’t receive a response until the family hired an attorney. In January, Edgemere executive director John Falladine told their lawyer that they would have a reply by the end of the week, which never came.
“We don’t feel very sure at all that we will see that money again,” William Thomas said. “We can’t close his estate until the money comes in.”
Read more
Occupancy in Edgemere’s 304 independent living apartments dropped from 93.3 percent in 2018 to 74 percent last year, according to its 2021 financial report. Occupancy in continuing care communities is supposed to remain in the 90 to 95 percent range, says Margaret Johnson, head of the senior living space at Fitch Ratings.
In a typical retirement community, refunds of deposits are dependent on new tenants putting down deposits. With Edgemere’s occupancy issues, this leaves a growing line of former residents or their family members waiting for their units to be rented.
In an emailed statement to the News, Jesse Jantzen, CEO of Edgemere’s parent company, Lifespace said Edgemere had 48 move-ins last year.
“Edgemere is compliant with all of its contractual obligations and former residents or their families are receiving refunds pursuant to their respective entrance fee contracts to the extent Edgemere has received a corresponding entrance fee from a new tenant,” said Rachel Chesley, senior managing director of Washington, D.C.-based FTI Consulting.
Lifespace hired FTI to evaluate operations and marketing strategies and address its financial straints, according to a call open to the public on March 10 about Edgemere’s finances.
As for the expired deal with its landlord and lenders, the community has allegedly paid back the rent and reached a new agreement with bondholders. Chesley declined to address how long the provisions would last or to say where the money came from or the amount. She also declined to specify how many former residents are waiting for refunds.
[Dallas Morning News] – Maddy Sperling