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Foreign Investors Plot Suburban Takeover Through Loudoun County

Breccan F. Thies 5–7 minutes

A foreign-owned private equity-backed rehab corporation is attempting to turn suburban America into luxury commercial rehabilitation facilities.

Newport Healthcare, which is primarily owned by the Toronto-based private equity firm Onex Partners, seeks to purchase suburban residential land in order to house patients and operate its rehabilitation centers in American neighborhoods.

One of the company’s attempted footholds is Loudoun County, Virginia — a wealthy suburb of Washington, DC, where the granting of permits could set precedent for other suburban neighborhoods, forcing families to live near treatment facilities for substance abuse, trauma, and other issues.

Residents are concerned that such commercial use in their neighborhoods would result in “opening Loudoun residential zones to this corporate misuse, negatively impacting home values, private equity acquiring more family residences, and fundamentally changing the neighborhood with commercial-level traffic, noise, risk of runaways, emergency service calls, and public disturbances that are reported around their other locations.”

Newport has acquired a subdivision of three single-family homes as well as ten adjacent acres of land, totaling a 25-acre facility, in Loudoun County.

The company attempted a similar arrangement in the wealthy McLean area of neighboring Fairfax County, where zoning officials denied requests to convert the residences into rehabilitation facilities.

Even so, the company does operate facilities in McLean and Great Falls — another wealthy Fairfax community — where nearby residents have reported disturbances.

One homeowner explained:

Since they have been open, we had about one month of constant runaways. Every other day, someone would run down the street in socks screaming while being chased by staff. Another girl sat in the middle of our road for about 2 hours, closing the street, while the police talked to her and finally took her away.

[They] have also had several visits from the fire department, mostly for smoke in the kitchen. The most notable visit was when they had a gas leak and the fire department’s presence indicated they thought the house was going to explode. Five fire trucks, an ambulance and the battalion chief showed up and closed Kurtz Rd. for about 30 minutes. I imagine someone left the gas stove on and Washington Gas showed up shortly afterwards. 

[They] opened an office in downtown McLean near the Giant [grocery store], where they shuttle new patients and employees with their transport van and minivan. Personal vehicles are also on the property, but [in addition] they use a combination of shuttles to operate.

Homeowners in Loudoun have banded together in an attempt to stop the corporation from purchasing parcels of land and single-family homes in their neighborhoods to build campuses for their facilities.

Residents also say Newport’s acquisitions would threaten a local non-profit called A Farm Less Ordinary (AFLO), which “provides employment, purpose, and community to developmentally and intellectually disabled via a peaceful rural flower and vegetable farm,” because the commercial traffic required by a Newport facility from staff and medical personnel would destroy the tranquility and stability offered by AFLO.

Protect Loudoun, a group taking this issue head-on, warns other county residents that their neighborhoods could be next and that “HOAs don’t matter” when a proposal is approved for “by-right” use — a step that is crucial to Newport’s business model, as it would be zoned residential, but operate essentially commercially.

The issue does not start and end in Virginia, as the company has locations across the country.

Indeed, what started in 2015 as two homes converted to rehabilitation facilities in Orange County, California, has snowballed into the purchase of as many as eleven separate homes in 2020.

At a cost of $1,000 per day per patient, the Orange County Register reported, that many homes have the potential to generate $2 million per month. However, without insurance, the average out-of-pocket expense per patient is $3,500.

Orange County residents have been confronted by the realities of the facilities as well, including runaways and other issues.

“Police sirens and the incidents that prompt them have become facts of life in Orange Park Acres,” the Register reported.

From 2017 to 2020, police responded to over 200 emergency calls from Newport facilities, including more than 40 reports for “missing juveniles,” and 17 for “minors posing a danger to themselves or others.”

A further account from the Register:

Teens running away from Newport Academy homes in Orange Park Acres have been found hiding in foliage, behind garages, wandering at night in dark and dangerous streets, neighbors said. Some have appeared on front porches at the crack of dawn, beseeching neighbors to help them escape.

Loudoun residents fighting against the Newport facilities say they are supportive of investing in mental health, but object to their neighborhoods being transformed into commercial rehabilitation facilities.

Breccan F. Thies is a reporter for Br eit bart News. You can follow him on Tw i tter  @ BreccanFThies.