At a time when the number of people with dementia is rising, a state of the art home for Alzheimer’s patients in north Toronto is on the verge of bankruptcy — because many of its beds are empty.

B’nai Brith, which opened the home’s doors to the public 18 months ago, has struggled to fill the 44 rooms and pay the bills despite $5.4-million funding from the federal government and the assistance of Western University’s Ivey International Centre for Health Innovation.

Now the four-storey retirement home is under insolvency protection and up for sale. Court documents prepared by the home’s owner warn that if a solution is not found it would “jeopardize” the care of the handful of residents now living in the Alzheimer Centre of Excellence near Bathurst Street and Finch Ave.

Meanwhile, bills are piling up. As of two weeks ago, the home had $65,000 in reserves and a cash “burn rate” of $50,000 a month. It owes $11 million to creditors, including a bank, a construction company and firms that leased televisions, washing machines, DVD players, WII games and a karaoke machine, all part of the care package that families pay $7,500 a month to support.

“Hopefully, someone else will come in and take the home over, and take it to the next level,” said new B’nai Brith CEO Michael Mostyn in an interview. He and others involved in the process stressed that the residents of the home are the priority in this process.

Last fall, Mostyn replaced Frank Dimant, who ran B’nai Brith for 36 years and came up with the plan for the home. Dimant said it took too long to build and he mistakenly kept a sign up saying “opening soon,” which led to a loss of confidence in the community as construction dragged on. Those funding the project became concerned.

“My policy was always to beg and plead (with the bank) and try for another day,” former CEO Dimant said in an interview. “Things caught up, I guess.”

The Alzheimer Society of Canada states that in 2011, the most recent figures on its website, 747,000 Canadians were living with Alzheimer’s disease and other dementias. Researchers predict that will rise to 1.4 million by 2031.

Dimant said he spotted this trend years ago and he envisioned a “beautiful modern facility.” B’nai Brith, known for community lodges, social housing, sports programs and its work combating anti-semitism, began designing the project in 2002. Some of the land was donated, some purchased. Donations were sought, and the federal government kicked in money, with some of it earmarked for work done for the home by specialists in innovative health care at Western University.

Western professor Anne Snowdon would not answer questions about the home, saying “we no longer have any affiliation with this organization.”

Just before it opened in 2013, B’nai Brith issued a release promising to “offer new hope to families afflicted by the cruelty of Alzheimer’s disease.”

“We understand you only want what’s best for your loved one. And we truly offer the most caring approach to living with Alzheimer’s. By offering cutting-edge programs. By collaborating on therapies at the forefront of Alzheimer’s research. And by providing the highest quality of personal, loving care that makes the difference between living with the disease, and living.” The home boasts beautiful gardens, well-appointed private rooms, and round the clock care.

“If you build it, they will come,” said Dimant, acknowledging more should have been done to market the home before it opened.

The other problems? Officials at B’nai Brith say the monthly charge — $7,500 — was too high. Then there were issues with the home. For example, none of the washrooms are wheelchair accessible. All residents must be able bodied, something that in hindsight was a mistake, officials say.

The home opened in December 2013 with four residents. During Dimant’s time it rose to 17. Recently, it has reached 20 residents. There are more staff than residents at the home, with 12 full-time staff and 20 part-timers.

Insolvency documents prepared by the home show that in February, the home wrote to the Bank of Nova Scotia to say it would be out of cash within two months and could not continue loan payments. Between then and now, the bank worked with the home (and then the insolvency trustee) to come up with a plan to sell the home.

Loading... Loading... Loading... Loading... Loading... Loading...

The home cost about $16 million to build and outfit. There were numerous work stoppages, cost overruns, and some legal action regarding unpaid contractors bills over the lengthy construction process. A selling price has not been set for the home.

B’nai Brith’s Mostyn said he is committed to returning his organization to the community work it has done so well over the years.

“My goal has been to modernize the way the charity conducts its business. That means taking advantage of new technologies and improving on the many grassroots initiatives and community services that B’nai Brith provides, like our principled advocacy initiatives, sports leagues, food basket programs and affordable housing,” he said.

Hampering that are issues left by former management (in addition to Dimant, many other staff left last year).

Among them is a lack of records and record keeping. Donors have told B’nai Brith, which is a charity, that money given over the years was not always acknowledged with a tax receipt. Since Mostyn took over, officials say that has not been a problem. The Canada Revenue Agency, which regulates charitable tax donations, has been in touch with B’nai Brith recently to remind it of its record keeping obligations as a charity.

Corporate governance is another issue. About 50 people across Canada thought until last week that they were on a board of governors or board of directors at B’nai Brith. They were told at a special meeting they were not, at least not technically. The past management at B’nai Brith had not filed paper work to the appropriate government agencies.

Under Dimant, according to people familiar with the situation, these “board members” had very little say. Mostyn is planning to rebuild the agency, with a focus on proper governance.

As part of his rebuild, Mostyn is hoping to bring in charity donations, which have lapsed in recent years.

A hitch in this plan is that Dimant has issued a demand for a retirement payout that the current management of B’nai Brith believes is too lucrative. Last week, Dimant, 69, informed the new management he is owed annual retirement payments of $175,000, which represents 75 per cent of his former salary.

Dimant described this to the Star as a “demand letter.” He said this arrangement was approved by the board. A source familiar with the deal said it was arranged with little oversight while Dimant was still the boss.

The charity is concerned that if it has to pay this money, it would have to use fund-raised dollars.