A large debt may have contributed to the abrupt closure of Magnolias Assisted Living last month, a lawsuit contends.
Pinnacle Bank filed a lawsuit against Magnolia Assisted Living Holding Company, LLC and other related entities that owned and operated the facility to foreclose on both the property and facility at 601 65th Avenue North in Myrtle Beach. The suit states Magnolia took out a $3 million commercial loan from Pinnacle Bank in 2008. As of Feb. 20, Magnolia still owed more than $1.5 million, according to the lawsuit.
While Magnolias Owner Ben Read surrendered the keys to Pinnacle after the home closed on Feb. 20, giving their elderly residents just 48 hours to vacate, Pinnacle attorney Douglas Zayicek said the facility closed before Pinnacle even called the loan in default. He said Pinnacle sent a default letter on Feb. 22.