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Bankruptcy affects two seniors retirement residences

Bankruptcy affecting two senior retirement residences in south Red Deer should serve as a wake-up call about the dangers of privatizing seniors housing, says the president of Central Alberta Council on Aging.

Bankruptcy affecting two senior retirement residences in south Red Deer should serve as a wake-up call about the dangers of privatizing seniors housing, says the president of Central Alberta Council on Aging.

Last month, Masterpiece Inc., of Montreal, filed for bankruptcy with $224 million of debt for Club Sierra Residences 2003 in Red Deer and Calgary and for Masterpiece Phase 2 facilities in Red Deer and Montreal.

Together Club Sierra in Aspen Ridge and Masterpiece Inglewood provide about 300 seniors housing units and employ about 140 people.

The new management company looking after the Red Deer facilities and the appointed estate trustee both say seniors are not at risk of losing their housing.

Denhaan said he will blame Alberta’s Conservative government if seniors housing is put in jeopardy.

“(The province’s) ideology says private is better. Let the investor do it. Let the investor take the risk, and if anything goes wrong, we will not be responsible,” Denhaan said on Monday.

But the province must share the responsibility if anything goes wrong, he said.

Minister of Seniors and Community Supports Mary Anne Jablonski said there will always be private housing facilities for seniors and Masterpiece Inc. did not receive provincial funding for construction.

But Alberta Health Services does provide funding for some residents and Jablonski said her department will be monitoring the situation very closely.

“Right now my primary concern is for the safety and security who are assessed to need medical assistance and I’ve been assured their needs are going to be met,” said the Red Deer North MLA on behalf of herself and Red Deer South MLA Cal Dallas.

Club Sierra, at 3100 22nd St. with 154 suites, has been in operation since 2004. Club Sierra has 150 residents, including 31 low-income seniors who are either receiving government assistance or who are on the Alberta Health Services waiting list for a bed.

“No residents are going to be moved and we will continue to fund the 26 designated assisted living spaces, as well as the five transition spaces at the facility. That will be maintained throughout the duration of the bankruptcy proceedings,” said Sissel Bray, executive director of seniors health Central Zone with Alberta Health Services.

Rent at the facilities include meals, activities, transportation and some housekeeping and range from $2,600 to $5,000 per month depending on the size of the unit.

Masterpiece Inglewood, at 10 Inglewood Dr., cost about $16 million to construct. It opened last summer with 154 one-and-two-bedroom suites and currently has a 46 per cent occupancy rate.

The luxury property includes a movie theatre, bowling alley, billiard room, pub, therapeutic pool and woodworking shop.

Eric Rodier, vice-president of RSM Richter Inc. the appointed trustee, said Masterpiece, originally of Calgary, had “significant cash flow deficiencies” in difficult economic times.

Occupancy rates at the two Quebec properties are at four and 28 per cent, he said.

“How long it will take — who knows — to bring up the occupancy rates. But right now the secure lenders are supporting it because they are substantial properties,” Rodier said.

“This will not affect the operation, the residents.”

Symphony Senior Living Inc., of Toronto, took over management of the facilities on Jan. 1.

Symphony CEO and president Lisa Brush said her company was hired on behalf of the former owner and secure debtors to stabilize the property to look after both staff and residents.

“For us, it’s business as usual. This is a legal proceeding. When these companies go into bankruptcy, there’s still an operation to look after and that’s what we’re doing,” Brush said.

“I don’t believe residents or staff had any disruptions. It was quite a smooth transition.”

Club Sierra in Aspen Ridge employs about 100 people and Masterpiece Inglewood has about 40 workers.

A creditors meeting will be held in Montreal on Friday.

szielinski@www.reddeeradvocate.com