Inspired Healthcare sale price of properties is 59% of $1.2 billion sold by advisors

A federal judge in Texas this week approved the sale of 30 properties controlled by bankrupt Inspired Healthcare Capital, with the sale price totaling $713 million, according to published reports.

That’s close to 59% of the $1.2 billion sold by financial advisors to clients.

The 30 properties are the lion’s share of the real estate controlled by Inspired Healthcare, according to attorneys familiar with the case.

The hundreds of millions of dollars from a sale of Inspired Healthcare properties does not mean an immediate windfall for investors who bought the high-priced, high-risk securities, said one plaintiff’s attorney.

The value of the Inspired Healthcare properties – and how any money from the sale will be used - for months has been hanging over the bankruptcy proceedings.

“The sale price is the headline number, but based on what we know today, I think it is very likely that many, if not most, DST investors will lose at least some of their principal investment,” said August Iorio, a plaintiff’s attorney working with clients who are suing the broker-dealers that sold the Inspired Healthcare investments.

“The sale prices may sound encouraging, but they don't tell us how much money will actually make its way back to investors,” Iorio added. “And there are still disputes over how the proceeds will be divided.”

Founded in 2016 by Luke Lee, Inspired Healthcare Capital of Scottsdale, Ariz., first used private placements to raise money and then in 2020 relied on Delaware Statutory Trusts, or DSTs. The company declared bankruptcy in February.

Broker-dealers and financial advisors that sold the now defunct private securities deals backed by the assisted living developer generated more than $100 million in fees and commissions for selling the securities.

The Securities and Exchange Commission in April 2025 “initiated a formal investigation into the company,” according to a court filing. In response to the investigation, Inspired Healthcare stopped making distributions to investors and lenders, according to the filing.

Over the summer, U.S. bankruptcy court judge Mark X. Mullin shocked some investor attorneys when he granted an injunction that enjoined or halted any new FINRA arbitration claims or the further proceedings of current claims. Mullin’s order was in response to a prior motion by Inspired Healthcare Capital Holdings.

There’s been some clarification to that issue.

According to Iorio, investors with FINRA arbitration claims against broker-dealers that sold Inspired Healthcare products may proceed, as long as the Inspired Healthcare products are set aside. The FINRA lawsuits then may proceed with other claims involving other sales practices and products.

“FINRA has also indicated that objections and related procedural disputes will be resolved by the arbitration panels,” Iorio said. “In practical terms, FINRA is leaving it to the parties and ultimately the arbitrators in each case to address the continuation of non-Inspired Healthcare claims, rather than automatically keeping every claim in a mixed-investment arbitration on hold.”