The company that owns The Heights Hospital filed for Chapter 11 bankruptcy on June 1 – nearly five months after its doctors, nurses, support staff and even patients were locked out of the building because of alleged financial delinquency.
According to documents filed in U.S. Bankruptcy Court for the Southern District of Texas, 1917 Heights Hospital, LLC, estimates that it has between $100-$500 million in assets and between $10-$50 million in liabilities. Its list of creditors, according to court filings, includes utility and telecommunications companies as well as the Harris County Appraisal District (HCAD), the Texas Attorney General’s Office and the Internal Revenue Service.
Another creditor is Nevada-based Arbitra Capital Partners, LLC, which in early January filed a lawsuit against The Heights Hospital managers Dharmesh Patel and James Robert Day, alleging they owe roughly $3.5 million in interest related to a $28 million promissory note they signed for the property at 1917 Ashland St. in January 2019, according to Harris County court documents.
County court records also show that a group of Houston investors sued the hospital and some of its related entities and individuals in February, seeking more than $2 million in damages and alleging their investment in the hospital was fraudulently misappropriated.
According to a June 4 court filing by the attorney representing the hospital in the latter case, “The hospital was forced into closure by the business downturn precipitated by the COVID-19 pandemic.”
That attorney, Ky Jurgensen of Houston law firm Hendershot Cowart P.C., declined to comment in an email Tuesday. The hospital’s bankruptcy attorney according to court filings, Steven Shurn of Hughes Watters Askanase, did not respond to a Tuesday voicemail and email seeking comment, nor did the Houston-based attorney listed for Arbitra, H. Miles Cohn of Crain, Caton & James.
The 160,849-square foot hospital building, which was constructed in 1978 and remodeled in 2020, is valued at more than $15.9 million, according to HCAD.
At least one other healthcare provider continues to use the building. Cobalt Rehabilitation Houston Heights operates on the fourth floor.