by THOMAS BREEN The new haven independent
A drug rehab company that shuttered its two New Haven facilities amid two executive suicides over the last week is nearly $230,000 behind in local real estate taxes — with its next $103,000-plus city tax bill due next week.
That’s among the revelations that are emerging about years of financial woes and “corporate anarchy” that plagued for-profit Retreat Behavioral Health before its sudden collapse this past week throwing hundreds of patients and workers into the cold in three different states.
According to New Haven Tax Collector Karen Gauthier, Coal New Haven LLC owes $226,397 in back taxes and interest for unpaid real estate tax bills that were due on July 1, 2023 and Jan. 1, 2024 for the Retreat in-patient facility it owns at 915 Ella T. Grasso Blvd. that abruptly closed last weekend.
Starting on July 1 — i.e., Monday — Coal New Haven LLC will owe another $103,209, which constitutes the first half of a $206,418.14 city real estate tax bill for that same property. The second half of that bill is due in January.
Translation: Coal New Haven currently owes more than $226,000 in back taxes to the city. That aggregate tax bill number will jump to $329,000 by next week. And then, assuming the debt isn’t paid by then, to $432,000 by January.
Gauthier, who is only four days into her new job as the city’s tax collector, declined to comment on if or when the city would initiate a tax foreclosure lawsuit for the property.
Coal New Haven LLC is controlled by Brooklyn-based investor David Silberstein. He could not be reached for comment by the publication time of this article.
The Ella T. Grasso Boulevard property itself is the site of the now-closed 80-bed in-patient drug rehab facility that was run by Retreat Behavioral Health. Coal New Haven LLC purchased the 2.7‑acre nursing home site in 2012 for $2.3 million; the city last appraised it for tax purposes as worth $7.6 million in 2023. Retreat opened its 80-bed in-patient facility at that site in January 2020.
As the Independent first reported, the company abruptly closed its Boulevard facility last Friday and its Long Wharf outpatient clinic on Monday. The company has also shuttered similar facilities in Florida and Pennsylvania over the past week — stiffing employees on their last two-week paychecks and discharging patients en masse who now need to seek out substance use disorder and mental health care elsewhere.
The company’s CEO Peter Schorr and then its chief administrative officer, meanwhile, have both died by suicide – the former last Friday, the latter on Wednesday. Silberstein’s company owned the Retreat’s real estate and provided the financing for the three-state enterprise; Schorr ran the medical/therapeutic operation.
Reporting by local news outlets in Florida and Pennsylvania in recent days have increasingly shined a light on the company’s financial disarray.
“The company ran out of cash,” Retreat’s CFO told the West Palm Beach TV news station WPTV on Thursday. That left 750 employees unpaid — and the CFO himself unsure as to whether or not he still has a job.
Financial trouble at Retreat did not begin this week, as evidenced by last year’s unpaid $230,000-plus New Haven tax bill. And so much more.
2022 New Haven Foreclosure Case
State court records show that, in September 2022, Fulton Bank filed a foreclosure lawsuit against Coal New Haven LLC, Coal’s Brooklyn-based manager Silberstein, and the now-deceased Retreat CEO Schorr, among others, regarding an overdue $9.2 million mortgage loan secured by the property at 915 Ella T. Grasso Blvd.
A July 2023 affidavit by Silberstein details the relationship between his company and Retreat, about the big money they borrowed, and about how they handled various debts.
That affidavit refers to Fulton’s $9.2 million mortgage loan from 2016, as well as that same bank’s $5.5 million mortgage loan from 2012, its $1.5 million “working capital loan” from 2016, and its $1.5 million “time loan” from 2018. That was all part “of a larger group of loans extended by Fulton to CNH and certain of its affiliates … all of which are engaged in the business of acquiring and developing real properties that are used to provide drug rehabilitation and mental health treatment, under the name Retreat Behavioral Health.”
In aggregate, he continued, Fulton advanced loans to Coal New Haven worth $17.7 million, with a current remaining balance of $13.5 million as of July 2023. He also wrote that Fulton Bank provided additional loans to other Coal-related companies worth an aggregate principal of $21.3 million, of which $15.1 million remained due as of July 2023.
A month later, on Aug. 25, 2023, Fulton Bank withdrew its foreclosure lawsuit against Coal New Haven LLC and the other defendants for the overdue mortgage loan at 915 Ella T. Grasso — thus ending that state court case.