Residents of The Covenant at South Hills, Inc., the financially troubled senior living community in Mt. Lebanon, have been assured by B’nai B’rith that their interests will be protected in the face of two foreclosure actions recently filed against the facility.
In an unsigned “Statement to the Resident Council of The Covenant at South Hills, Inc,” B’nai B’rith wrote: “B’nai B’rith Housing, Inc.’s role as sponsor of The Covenant at South Hills, Inc. has not changed and … the Board of Directors of The Covenant at South Hills, Inc. continues to be vitally concerned about the welfare of the residents of the Covenant.”
The statement came in response to concerns by residents that their home could be sold, and their investments into the property, which ranged from about $90,000 to $319,000, could be lost, as a result of the foreclosure proceedings instigated by some of the bondholders who had financed the facility.
B’nai B’rith further wrote in its statement that: “Covenant’s Board of Director’s is evaluating every option and is working with representatives of the state government in an effort to find a solution, always keeping the best interests of the residents and their families at the forefront.”
The continuing care facility, which features independent living, assisted living and skilled nursing components, opened in 2002 as B’nai B’rith’s first foray into continuing care for seniors. Although B’nai B’rith had long been involved with a variety of government-subsidized housing projects, it had no previous experience with building or operating a continuing care facility such as Covenant.
The Covenant was intended to be a sort of prototype facility for B’nai B’rith, and was hailed as “a flagship kind of development,” by its then-executive director, Marianne Hogg.
The 279,000 square foot facility, built on property hidden from view off of Bower Hill Road, came with a $60 million price tag. Some say the value of Covenant is now only about $25 million, although that figure could not be independently confirmed.
According to B’nai B’rith, only about 75 percent of Covenant’s independent housing units are currently occupied, although approximately 95 percent of its assisted living and nursing units are filled.
From its inception, Covenant faced higher than anticipated operating costs and real estate taxes, and very quickly became in default of its loan payments.
Residents, who pay a monthly service fee to Covenant in addition to their initial investment, say they relied on the reputation of B’nai B’rith when purchasing their interests in the facility, and counted on that organization to ensure that the Covenant would be competently run and managed.
“Many of the people who live here did not investigate this because it’s clearly stated that this is a B’nai B’rith community. We didn’t look into the details,” said Maury Deul, president of the Covenant’s Residents’ Council. “Now we find out the B’nai B’rith has no liability legally. Morally they may have.”
Members of the Covenant’s board of directors said they were asked by B’nai B’rith not to speak to the press on this matter.
(Toby Tabachnick can be reached at email@example.com.)