"One of the largest and oldest drug rehabilitation agencies in New York State announced on Friday that it had filed for Chapter 11 bankruptcy protection.
The agency, Daytop Village, said the move was “a result of extreme financial pressure from its lending institutions.”
According to court papers, it owes more than $33 million, secured by nearly $50 million in real estate holdings, to Signature Bank and Hudson Valley Bank.
Daytop lost $28.2 million over five years, starting in 2006, the court papers said. It attributed the losses, in part, to a decline in inpatient residents, to about 700, from 1,100 in 2006.
Declaring bankruptcy will allow Daytop “to continue its mission of treating and rehabilitating substance abusers while it continues to reorganize, improve its financial position and ensure long-term viability,” the agency said.
Daytop was founded in 1964, and with 375 full-time workers, it serves about 2,000 people at 14 residential facilities and outreach clinics across the state. It has already agreed to sell its Manhattan headquarters to help pay off its debt. The property is under contract for $26.5 million, the court papers say."