Senior Housing Finance Activity: Ziegler, Lancaster Pollard, Oak Grove

Ziegler Closes $24.16M Financing For North Carolina CCRC

Ziegler, a specialty investment bank, closed a $24,160,000 Series 2014 tax-exempt non-bank qualified transaction issued by the North Carolina Medical Care Commission for Deerfield Episcopal Retirement Community (Deerfield), a new client to Ziegler.

Deerfield is a Type-A LifeCare continuing care retirement (CCRC) operator located on 125-acres in Asheville, N.C. The Deerfield campus has a total of 473 units consisting of 351 independent living units, 60 assisted living units and 62 skilled nursing units.


In April 2013, Deerfield received a five-year accreditation from the Commission on Accreditation of Rehabilitation Facilities – Continuing Care Accreditation Commission (CARF-CCAC), which they have had since 2003.

Ziegler served as the placement agent for the refunding transaction which resulted in a significant reduction in Deerfield’s future debt service, Ziegler says in a written statement. Deerfield received several attractive bank proposals but selected First Citizens Bank and Trust (First Citizens) as the credit provide due to superior pricing and terms.

The proceeds of the $24.160 million Series 2014 Bonds will be used to refund the Series 2004A Fixed Rate Bonds in their entirety; refund the Series 2004B Adjustable Rate Bonds in their entirety; and pay certain costs of issuance associated with the refinancing.


Given that the loan is coterminous with the amortization of the Series 2014 transaction and the bank provided a direct fixed rate, the refinancing does not expose Deerfield to additional put risk or interest rate risk. The Series 2014 transaction will result in net present value savings of over $2.5 million (10.26% of refunded bonds).

“Deerfield’s proactive approach to its capital structure has allowed the organization to significantly reduce its debt service while also mitigating future risk,” said Tommy Brewer, managing director in Ziegler’s senior living finance practice.

Lancaster Pollard Funds $36M, Refinances $24M for Indiana CCRC

Situated in a neighborhood setting just two miles from Purdue University in West Lafayette, Ind., Westminster Village is a nonprofit 280-bed continuing care retirement community (CCRC).

The campus offers independent living (IL) apartments and homes, as well as on-site assisted living (AL) and Medicare-certified skilled nursing, including rehabilitative care and memory support care.

Westminster sought a financing solution that would allow it to refinance its existing debt as well as fund the new  construction of three IL buildings and a new health and wellness building. 

Working with two regional banks, Lancaster Pollard was able to fund $36 million for the new construction project as well as $24 million for the refinance through a structure that included three series of bonds per bank. The expansion project was funded through a long-term bond series of $36 million in new money. The $24 million refinance was funded through two bonds series; one long-term and one short-term that would be repaid via the collection of entrance fees.

In addition, Lancaster Pollard layered two interest rate swaps on top of the structure that provides Westminster a synthetically fixed, blended interest rate that resulted in significant savings.

Chris Blanda, health care banker representing Indiana and Kentucky, led the transaction for Lancaster Pollard. 

Lancaster Pollard Finances New Construction For Virginia CCRC

Located in Roanoke, Va., Friendship Retirement Community is a non-entry fee, lease-based continuing care retirement community (CCRC).

Friendship offers the full continuum of care, including independent living (IL), assisted living (AL), skilled nursing, home care, rehabilitation services, and institutional and retail pharmacy services.

The 839-bed/unit CCRC has developed a comprehensive program serving the housing and health care needs of seniors.

To continue its mission and expand its success, Friendship sought to both refund its Series 2013 bonds and to obtain financing for the new construction of a 120-bed skilled nursing facility (SNF) that would be located in South Roanoke.

Friendship is located in North Roanoke and the new SNF would allow ownership to expand its services to the rehabilitation and therapy segment of the greater Roanoke market. 

Lancaster Pollard pursued a tax-exempt bond financing for both the refunding and the new construction needs. The firm compiled a credit request and solicited bids from several banks, thus creating a competitive bidding process for the bonds.

Ultimately, the firm privately placed $36.5 million in two bond series (one refunding and one new construction) with a regional bank. Lancaster Pollard recommended creating a master trust indenture for issuance of further tax-exempt debt, which helped to streamline Friendship’s future tax-exempt bond 

The transaction refunds Friendship’s Series 2013 bonds, a portion of which is fixed via an interest rate swap, generating significant debt service savings. In addition, the closing will fully fund the construction of the new SNF which keeps Friendship’s investment portfolio and liquidity position intact.

Tom Gale, health care banker representing Virginia, Maryland, Delaware and Washington, D.C., led the transaction for Lancaster Pollard.

Lancaster Pollard Closes $3.9M Loan for Ohio Skilled Nursing, Assisted Living Community Renovation

Lancaster Pollard closed a $3.9 million loan for Quaker Heights Care Community to fund a construction project using the FHA Sec. 232/241(a) program.

Located in Waynesville, Ohio, Quaker Heights is composed of skilled nursing and assisted living units and ownership sought to modernize the facility by a renovation and expansion project.

As Quaker Heights already had an outstanding FHA Sec. 232 loan, it was able to use the FHA Sec. 232/241(a) program, which is nonrecourse and provides a low, fixed interest rate and long term. Kass Matt, managing director, led the transaction for Lancaster Pollard. 

Lancaster Pollard Refinances Debt for Three Michigan Senior Living Communities

Lancaster Pollard recently refinanced the existing debt for three senior living communities in Michigan. Located in Southeastern and Central Michigan, two of the communities offer assisted living, memory care and skilled nursing and the third is a stand-alone skilled nursing facility.

The properties were refinanced through the FHA Sec. 232/223(f) program at interest rates below 4% and terms between 30 and 35 years. Loan proceeds totaling just under $40 million were used to refinance existing bank debt, fund several owner-elected repairs and make significant replacement reserve deposits for future property repair needs.

The transaction was led by Brendan Healy, vice president with the firm representing Michigan and Wisconsin.

Ziegler Closes $51M Financing for Wisconsin Hospital

Ziegler, a specialty investment bank, closed $51,785,000 Rogers Memorial Hospital Incorporated Series 2014 Bonds issued through the Wisconsin Health and Educational Facilities Authority. 

Rogers Memorial Hospital Incorporated is Wisconsin’s oldest unaffiliated nonprofit behavioral health provider. Founded in 1907 by Dr. Arthur Rogers, Rogers is a leader in the mental health care field, committed to increase the accessibility of mental health care and providing mental health care treatment to southeastern Wisconsin.

Over the years, Rogers expanded from one hospital to a health system comprised of two inpatient hospitals, five residential  facilities and four outpatient treatment centers serving patients in Wisconsin, throughout the United States and internationally.

Rogers is nationally recognized for its specialized programs for treating children, teens and adults with OCD and anxiety disorders, eating disorders, depression and other mood disorders, as well as addiction. 

Ziegler served as the sole manager of the $51,785,000 tax-exempt fixed-rate Series 2014 Bonds. The Series 2014 Bonds were structured as two series of bonds: $28,270,000 Series 2014A which were single tax-exempt (Federal) and $23,515,000 Series 2014B which were double tax-exempt (Federal and State of Wisconsin).

The proceeds of the Series 2014 Bonds were used to refund four exiting series of bonds that were issued with bank credit support and fund the capital necessary for their strategic expansion. The Series 2014 Bond issue eliminated many capital structure risks and restructured the debt repayment to provide a level annual debt service resulting in pro-forma MADS 
coverage in excess of 6x.

In conjunction with the financing, Ziegler assisted Rogers in achieving their first time rating of BBB+ from Standard and Poor’s. The Series 2014 Bonds had an all-in interest rate of 4.42%. 

“Rogers’ management team and its medical staff have done an exemplary job growing the organization, achieving exceptional financial results and providing high quality care to those in need of highly specialized mental and behavioral health services,” said John Hanley, managing director and Head of Healthcare Finance at Ziegler, in a written statement.

Oak Grove Capital Closes Six Loans for Minnesota Senior Housing Communities 

Oak Grove Capital closed six loans totaling $18.9 million. The largest seniors housing deal was for Copperfield Hill Manor, a 157-unit complex located in Robbinsdale, Minn. at $9,408,000.

The $9.4 million FHA refinance loan was facilitated by Michael Leonard, vice president, Oak Grove Capital.

Other loans included a $1,221,400 refinancing for Prairie Senior Cottages of Alexandria in Alexandria, MInn.; a $1,060,600 refinancing for Prairie Senior Cottages of Hutchinson in Hutchinson, Minn.; a $1,098,200 refinancing for Pririe Senior Cottages of New Ulm in New Ulm, Minn.; a $1,126,400 refinancing for Prairie Senior Cottages of Willmar in Willmar, Minn.; and a $4,960,000 refinancing for Copperfield Hill Lodge in Robbinsdale, Minn.

Written by Cassandra Dowell

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