Ziegler Places First Start-Up CCRC Financing in 2009 For Hawaiian Project

Last week, Ziegler Senior Living Finance announced the successful pricing of $86 million fixed-rate bonds for 15 Craigside, a new continuing care retirement community to be built in the Nu’uanu suburb of Honolulu, Hawaii.  The pricing marks the fifth sizable senior living issue in 2009, the first start-up CCRC (Continuing Care Retirement Community) financing in more than 18 months, and the largest fixed-rate financing so far this year.

The project, 15 Craigside, will be a 13-story building located on a 1.5-acre site in Nu’uanu, northwest of Waikiki Beach, on the island of Oahu. The community will include 170 independent living apartments (ILUs), 41 nursing beds, 4 unlicensed nursing “boarder beds,” and common areas including a pool, wellness, dining, and many other typical CCRC amenities. The ILUs will be licensed to provide assisted living services as needed by Arcadia Home Health Services.

“In the toughest months of an unforgiving financial environment and a frozen bond market, Ziegler was a key factor in keeping our dream and mission for this senior living community alive and within reach,” said Emmet White, CEO of Craigside Retirement Residence.


“The solid and enthusiastic response of the institutional bond market to a non-rated start-up senior living transaction is highly encouraging news for the senior living sector,” said Mary Muñoz, managing director for Ziegler. “As clients across the country are re-evaluating growth and redevelopment opportunities, Craigside’s success is a great positive indicator of market appetite.”

Ziegler structured both the short-term debt (to be repaid with entrance fees) and the long-term debt with term bonds and Ziegler’s ARROSSM adjustable-rate bonds. The average yield on the short-term debt is 7.18%, and the average yield on the long-term debt is 9.12%, with a top yield of 9.15% on the 2044 term bond.

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