Sears Tyler Methodist Retirement Corp.’s local senior living community, Meadow Lake, will reportedly be unaffected by its parent company filing for bankruptcy.
Sears Methodist Retirement System Inc. parent company of Sears Tyler Methodist Retirement Corp., filed for relief under chapter 11 bankruptcy June 10 in federal district court in Dallas.
“Just recently the system board of trustees made a decision to move forward with a financial restructuring involving a voluntary chapter 11 filing,” according to a statement. “Making this decision will allow us to reduce our debt while continuing normal operations at our campuses, thereby ensuring that a high quality of care continues. Our system’s business model is sound and our operations strong. We look forward to many years of service in the years ahead.”
Spokeswoman Nancy Shellhorse, of Austin, said the company filed for bankruptcy because restructuring negotiations between Sears Methodist and certain holders of a significant portion of the system’s debt were unsuccessful.
The bankruptcy protection allows the company to deal with about $160 million worth of funded debt obligations attached to its operations, including its eight senior living communities and three veterans homes in Texas. Sears Methodist received court approval to borrow $600,000 from existing bondholders after it warned that it would be forced to stop operations without access to the funds, Ms. Shellhorse said.
The board of directors of the nonprofit corporation voted to file for bankruptcy after considering the financial and operational aspects of the business and the reorganization of it, according to court documents.
“The chapter 11 filing means very little for the day-to-day operations of the Meadow Lake community,” Ms. Shellhorse said. “The community will remain open, staffed and equipped to handle all resident needs.”
Residents began moving into Meadow Lake, which sits on a 92-acre campus in South Tyler, in 2010.
Judge Stacey G. Jernigan granted a motion to consolidate and jointly administer the bankruptcy cases for Sears Methodist Retirement System with its 11 other companies, including Tyler Methodist Retirement Corp.
Sears Methodist listed its 20 largest unsecured creditors in court documents, which include several East Texas businesses.
Debts listed include $13,970 to Southwest Floor Carpet One in Tyler; $11,869 to Sysco East Texas in Longview; $10,500 to LJT Painting and Contracting in Flint; $4,618 to Taylor Wholesale Distributor in Tyler; $2,100 to Brosang’s Landscaping Inc. in Whitehouse; $2,016 to the City of Tyler; $1,600 to A&A Septic Tank SVC in Tyler; and $741 to Ashley J. Walker in Flint.
“All unsecured creditors will have the opportunity to participate in the chapter 11 case through a committee that we anticipate will be appointed to represent their interests,” Ms. Shellhorse said when asked what it would mean for the businesses.
A meeting of creditors is scheduled for July 10 in Dallas.
Sears Methodist Retirement System, Inc., a not-for-profit provider of senior living services based in Abilene, opened its first senior living community in 1966 and has expanded its scope to include residential living apartments and homes, assisted living, skilled nursing care, specialized Alzheimer’s care, home care, pharmacy, consulting services and community outreach services.
Sears Methodist serves more than 1,510 residents and has nearly 1,500 staff members. The company and its affiliates operate eight retirement communities in Texas, as well as three Texas State Veteran’s Homes, Ms. Shellhorse said.
The Watkins-Logan Texas State Veterans Home in Tyler is managed by San Antonio-based Touchstone Communities.
Sears Methodist began planning in 2005 to bring a retirement facility to Tyler.
The company joined forces with several community members, who donated 92 acres of land for the project. When the community’s Longleaf Healthcare Center opened in 2011, Meadow Lake became Tyler’s first continuing care retirement community —- a senior living community that offers independent residential living, assisted living and skilled nursing care on one campus for people 55 and older, representatives said at the time.
The campus, off County Road 165 near its intersection with Old Jacksonville Highway, is home to 250 to 300 residents and employs about 120 full-time employees, representatives said in 2011.