California-Nevada Methodist Homes filed for chapter 11 bankruptcy protection Tuesday in a bid to avert disastrous consequences at its two retirement communities if the Oakland-based operator's unruly debt isn't reined in by the court, the San Francisco Business Times reported. Otherwise, Methodist Homes, which offers four levels of care up to skilled nursing and rehabilitation, says it will be "unable to operate its business during the chapter 11 case" and could result in "potentially leaving residents without food, medical supplies, proper medical care, and other services they require," according to documents filed in bankruptcy court. Years of financial troubles exacerbated by COVID-19 has strained the nonprofit senior living operator's finances to the point it where it can no longer make good on payments for a roughly $33 million tax-free bond it borrowed in 2015to refinance and to make more than $6 million in renovations to its two retirement homes. Methodist Homes stopped making payments on the bond, managed by Wilmington Trust, in February 2020. Methodist Homes, which was founded nearly 70 years ago and operates retirement communities in Oakland and Pacific Grove, is hoping the court will allow it to continue using its remaining assets to pay 223 employees and expenses related to operating the homes and their 220 residents until it is able to come up with a plan, likely finding a buyer. According to its bankruptcy documents, Methodist Homes owes between $50 million and $100 million.
