Reply to "The Ethicist" on Sidwell's Hospice Purchase

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[quote=Anonymous][quote=Anonymous]I am actually the othe co chair. Not Ms Mayfield. The property sold undervalue based on its appraisal, the size of the land and consultation with real estate agents. As for the The Washington Home's financial woes no one except The Wash Home, invluding The Post, knows the particulars of those vis a vis the long term care people being displaced because TWH won't disclose them and are not required to parse out where their losses come from on their 990s. I encourage you to read our letter on p 15 of the NW Current i believe Oct 6 or 7 before you accuse the victim here or cry sour grapes. Unlike virtually any of the people on this list I am willing to both disclose my identity and my interest. I suggest those engaging in name calling do a little research and then turn that magnifying glass on themselves.  And I would encourage everyone blindly defending either institution to dig down into what their interest was in excluding residents and their families from the process. [/quote]

A couple of observations.  First, DC appraisals are notoriously arbitrary, particularly with respect to non-taxpaying entities' properties, and therefore can inflate the true market value.  Because they don't pay property taxes, the tax-exempt institutions have no incentive the way tax paying entities do to hire lawyers and other advisors to contest their property assessments with market data.  For example, Fannie Mae is appraised at $100 million or more, but no one expects it to sell for that.  Second, the press reported that TWH had hired a broker in the process, which presumably was advising the board on valuation ranges based on an analysis of the market.  Armchair realtors and Monday morning quarterbacks may have their own notions, but probably not based on the detailed analysis that the Home's RE advisors did -- and the brokers, like the TWH board, had every incentive to maximize price while adjusting for closing risk.   Third, even if some hypothetical buyer out there were prepared to pay a bit more (a big if, given zoning approval risk), TWH has already said it is getting out of the brick and mortar hospice and nursing home model.  So while a hypothetical, incrementally higher price might have some upside bearing on TWH's ability to provide additional future at-home care, it's hard to see how current patients would benefit because the board has decided to close the facility and sell it.  Fourthly, any other purchaser like a developer would be impatient to start the bulldozers and likely would be less flexible than Sidwell in accommodating a longer transition period.   Lastly, a friend who works at TWH mentioned that some patient outplacements have already started, which raises the question of whether TWH will need almost two years to wind down operations.   There's no question that this change must be hard for patients and their families, but it seems that the board and families of TWH need to communicate more openly about the institution's challenges and shift in focus.[/quote]

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