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Foreclosure request is filed for Sumner on Ridgewood
By John Higgins
and Cheryl Powell
Beacon Journal staff writers
Published on Wednesday, Aug 27, 2008
COPLEY TWP.: The bank that financed one of the area's most upscale retirement communities sued for foreclosure Tuesday morning in Summit County Common Pleas Court.
The New York-based branch of lender KBC of Belgium also asked Judge Thomas Teodosio to place the nonprofit owner of the community — Sumner on Ridgewood — in court-supervised receivership that would oversee the marketing and sale of the property.
Sumner owes about $1.5 million in missed payments and other obligations, according to the complaint.
Sumner also owes nearly $4 million in delinquent property taxes and related interest penalties, according to Summit County property records.
The board of trustees for Sumner on Ridgewood unanimously consented that Jeffrey T. Heintz, managing partner of the Akron law firm Brouse McDowell, be named the independent receiver.
Heintz and Sumner trustee chairman Wayne Rice attended a regularly scheduled meeting of the independent living residents at 10 a.m. on Tuesday to assure them that the quality of their services will not change.
''The goal of everyone is to have this facility, in its current form, exist in perpetuity on solid financial footing,'' Heintz said Tuesday afternoon. Heintz said the outstanding debt on the mortgage is about $34 million.
David Wilson, 85, who is treasurer of the residents' association, said they were assured that ''nothing is going to be changed.''
''It sounded good,'' added Wilson's wife, Evelyn. ''I don't feel concerned about it. . . . We'll just have to wait and see.''
The Wilsons were among the first residents in the retirement community's independent villas when the campus on Ridgewood Road opened in 2003.
Sumner previously operated a landmark nursing home on Merriman
Road before opting to relocate and expand by constructing the new $55 million retirement community in Copley Township.
The senior living community is on 64 acres across from Copley High School in Copley Township and houses about 180 residents.
The sprawling complex has 22 ranch-style villas, 79 independent-living apartments, 40 assisted-living units and 48 skilled-nursing home beds.
Amenities at the popular senior community are a fitness center, meditation room, in-house TV station, indoor pool and whirlpool, an auditorium, a library, a computer center and an on-site beauty salon, shop and deli.
Residents supportive
Sumner's operator, Life Care Services LLC, is well respected, said Heintz, who will review all of Sumner's contracts.
''The residents are supportive of Life Care, the bank is supportive of Life Care, and the [Sumner] board is supportive of Life Care,'' Heintz said. ''The likelihood is that Life Care and what it's doing will remain in place going forward.''
The mortgage debt is related to bonds that were sold to pay for construction of the campus on Ridgewood Road.
Beginning in late 2007, Sumner stopped making required payments, according to court filings. Negotiations continued through 2008 to address the matter.
''The institution has been — into the fourth quarter now — unable to operate the facility, paying its debts as they come due and service the financing that is owed to the banks on account of construction,'' Heintz said.
Sumner had identified two prospective buyers in the last eight months or so, but those deals didn't reach fruition.
Agreement on receiver
Within the last two weeks, the trustees consented to the appointment of a receiver and agreed it should be Heintz.
''Sumner's board has been very forthright with the residents on keeping them up to speed as far as what's going on,'' Heintz said. ''This is the latest step in that process.''
A Columbus attorney representing KBC Bank, Douglas Mansfield, said the trustees' consent was welcome and agreed that the best outcome for all parties would be the sale of the retirement community to an owner that would maintain its quality.
''That's their hope, that they can find a good purchaser to keep it going in perpetuity,'' Mansfield said.
He said KBC and the trustees were pleased with the selection of Heintz as the receiver.
Seeking a buyer
Heintz said his firm must now assess Sumner's finances and then find a broker who can market the community and find a buyer.
The county has first lien on the property.
Part of the tax debt is expected to be forgiven if the state Board of Tax Appeals grants tax-exempt status to the assisted-living and skilled-nursing portion of the community, Heintz said.
''The expectation is a significant portion of it will be forgiven,'' Heintz said. ''There is a realization by the banks that in the event that the exemption is not granted or it's not granted to the extent they are seeking, that's going to have an impact.''
He said there is no deadline from the lender for action. ''There is no one who has a gun to this company's head saying if you don't do this by such and such a date, I will pull the trigger and you will be dead,'' he said. ''We are not in that situation, happily, as we sit here today.''
John Higgins can be reached at 330-996-3792 or jhiggins@thebeaconjournal.com. Cheryl Powell can be reached at 330-996-3902 or chpowell@thebeaconjournal.com
COPLEY TWP.: The bank that financed one of the area's most upscale retirement communities sued for foreclosure Tuesday morning in Summit County Common Pleas Court.
Get the full article here.
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