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Transactions & Financings: Enso Village Closes $297M Bond Funding; Acts Retirement-Life Communities Bond Rating Affirmed

Enso Village, the $300 million life plan community under development from Kendal Corporation, Greenbrier Development and the San Francisco Zen Center, now has the majority of its capital stack in place to begin construction.

Chicago-based investment bank Ziegler closed on a $297 million bond debt package on behalf of the joint venture. The bonds were issued through the California Public Finance Authority. The debt was issued in three tranches: one as tax-exempt, fixed rate bonds amortizing over 35 years; one expected to be redeemed at 85%, 70% and 50% occupancy of the development; and the third expected to be redeemed at 13% occupancy.

Bond proceeds will be allocated toward construction of the campus, refinancing pre-development capital, paying 33 months of interest on the bond debt, fund debt service reserves for each tranche of debt, and pay miscellaneous costs associated with issuance.

The development team received approval to proceed with construction on June 18, Kendal Senior VIce President of New Business and Development Steven Bailey told Senior Housing News. Construction is expected to last 25 months, and Enso Village is set to open in late summer 2023.

Affiliations

Covenant Living, Three Crowns Park enter affiliation agreement

Covenant Living Communities and Services entered into an affiliation agreement with Three Crowns Park, a life plan campus in Evanston, Illinois. Upon the anticipated closing on July 1, Covenant will assume management and operations of the 125-year-old community, with shared governance and leadership.

Proveer Senior Living, East Gate Alliance announce partnership

Proveer Senior Living, a vertically integrated senior housing developer and management company in McKinley, Texas, announced a general partnership agreement with East Gate Alliance, a family office real estate investor based in Oceanport, New Jersey.

The agreement allows the partners to rapidly close on a multitude of acquisition opportunities. The JV has worked collaboratively since early 2021 developing a partnership that also provides multiple lines of credit for pre-closing deal costs, due diligence expenses, and corporate overhead, as well as access to working capital for multiple years.

Sales and operator transitions

Sherer Management sells 2 CCRCs, exits industry

Sherer Management Services, a senior housing and care operator based in Woodbine, Iowa, disposed of two continuing care retirement communities in western Iowa: Rose Villa in Woodbine and Longview Home in Missouri Valley. With these dispositions, Sherer is exiting the senior living and care industry.

The CCRCs offer independent living, assisted living and skilled nursing services, as well as hospice care through Generations Hospice. Lumen Vice President, Mergers and Acquisitions Dominic Porretta and Director Kevin Laidlaw led the transaction. The buyer is a regional operator, partnering with a private capital provider. Terms of the deal were not disclosed.

Livingston Street Capital acquires Texas active adult community

Livingston Street Capital acquired a 180-unit, 55-plus active adult rental community in Lewisville, Texas, which the company rebranded as Haven at Lewisville Lake. This is the first Texas addition to Livingston Street’s expansive and geographically diverse active adult and independent living portfolio, and brings the firm’s total unit count to over 1,000 units.

National Church Residences acquires Texas affordable senior apartments

National Church Residences acquired Westminster Square Apartments, a three-story, 107-unit affordable apartment building for seniors in San Antonio. The building serves seniors age 62 and older, and offers studio, one-bedroom and two-bedroom units. Westminster Square is the nonprofit provider’s 32nd community in Texas, and third in the metro San Antonio market. National Church Residences will also assume management from Capstone Real Estate Services.

The acquisition was financed with a Lument FHA loan and company equity.

Newmark sells 2 Texas active adult communities

Newmark (Nasdaq: NMRK) completed the sale of two active adult communities in Texas: Attiva Denton, a 240-unit community in Denton; and Attiva Park, a 162-unit community in Ft. Worth. Terms of the deal were not disclosed.

Newmark Co-Heads and Vice Chairmen of the company’s Healthcare and Alternative Real Estate Assets Group Ryan Maconachy and Chad Lavender represented the seller, Cortland, in the sale.

SLIB completes sale of Georgia assisted living facility

Senior Living Investment Brokerage Managing Director Brad Clousing and Senior Vice President Dan Geraghtycompleted the sale Brickmont Assisted Living and Memory Care, a 94-unit assisted living and memory care facility in Milton, Georgia. The seller was a local developer looking to exit the building as it reached its investment horizon. The buyer Tennessee-based partnership looking to expand its footprint in strategic markets across the southeast U.S.

Financings

Ziegler, M&T Realty Capital Close $4.4M Fannie Mae Refinancing for Essex Communities

Ziegler, in partnership with M&T Realty Capital, completed a $4.37 million Fannie Mae refinancing package on behalf of Essex Communities. Proceeds will refinance existing debt on The Regency, a 55-plus active adult community in Kearney, Nebraska.

The 10-year, fixed-rate loan was structured at 75% loan-to-value with two years of interest only payments, followed by 30 years of amortization. The package also carries a declining prepayment schedule, providing Essex with flexibility in later years. Director Eric Johnson led the transaction for Ziegler from the company’s Denver office. Managing Director Steven Muth and Seniors Housing Program Manager Matthew Pipitone led the transaction for M&T.

BMO Harris closes $19.4M construction loan for Sunrise Senior Living

BMO Harris Healthcare Real Estate Finance closed on a $19.4 million construction loan for Sunrise Senior Living. Proceeds will fund the renovation of a 110-unit assisted living and memory care facility in Redmond, Washington.

Ratings Outlooks

Fitch announces bond rating updates on 7 CCRCs

Fitch Ratings announced the following bond ratings updates:

  • Fitch assigned the “A-” issuer default rating to Acts-Retirement Life Communities, and affirmed the “A-” rating on revenue bonds issued by various issuers in Pennsylvania, Delaware, South Carolina, Florida and Georgia on behalf of the nonprofit provider’s obligated group. The rating outlook is stable. Additionally, Fitch removed the obligated Group from under criteria observation. Key rating drivers include Acts scale as a multi-state provider; an operating profile consistent with its scale and growth; and a resilient profile in the face of moderate stress.
  • Fitch assigned a “BBB” issuer default rating to Fox Run at Orchard Park, a CCRC in Orchard Park, New York, and upgraded the bond rating on $39 million in Series 2015 revenue refunding bonds issued by the Buffalo and Erie County Industrial Land Development Corporation. The rating outlook is stable. Key rating drivers include improving liquidity and strong cost management measures.
  • Fitch assigned a “BBB” issuer default rating, and affirmed the rating on $46 million in Series 2016 fixed rate revenue bonds issued by the New Hope Cultural Education Facilities Finance Corporation on behalf of the Legacy Willow Bend, a CCRC in Plano, Texas. The rating outlook is stable. Key drivers include solid demand, a history of sound operating metrics, and an adequate near-term financial outlook.
  • Fitch assigned a “BBB” issuer default rating, and affirmed the “BBB” rating on $22.6 million in Series 2015A fixed rate bonds issued by Indiana Finance Authority on behalf of Marquette, a CCRC in Indianapolis. The rating outlook is stable. Key drives include solid demand trends, a strong cash position, and improved operations.
  • Fitch assigned a “BBB” issuer default rating on Series 2021 revenue refunding bonds expected to be issued by New Hope Cultural Education Facilities Finance Corporation on behalf of Westminster Manor, a CCRC in Austin, Texas. The rating outlook is stable. Key rating drivers include a strong market position, consistent operations, and moderate pressures stemming from an ongoing debt-funded expansion project.
  • Fitch assigned a “BBB” issuer default rating on $59 million in Series 2021 A and B revenue refunding bonds to be issued by the Indiana Finance Authority on behalf of BHI Senior Living, a retirement community in Indianapolis. Fitch also affirmed the “BBB” rating on $179 million in revenue bonds series 2011, series 2013A, series 2016A, and series 2018A issued by IFA on behalf of BHI. The rating outlook is stable. Key drivers include Robust demand at multiple campuses, consistently strong historical operations, an adequate financial profile with expected improvement, and lingering pressures on its managed care and skilled nursing cohorts stemming from Covid-19.
  • Fitch assigned a “BB+” issuer default rating, and affirmed the “BB+” rating on $134.65 million in various bond debt issued by the Florida Development Resource Corporation and the Orange County Healthcare Facilities Authority, on behalf of The Mayflower Retirement Center in Winter Park, Florida. The rating outlook is stable. Key drivers include a good market position in a competitive market, adequate operating performance, an ongoing independent living expansion, and midrange revenue defensibility and operating risk assessments.

Miscellaneous

Kinderhook Industries affiliate acquires Medicare Advantage network

MHH Healthcare, an affiliate of New York City-based private equity firm Kinderhook Industries, acquired Medical Card Services (MCS), a health care services organization based in San Juan, Puerto Rico offering a variety of insurance plans and managing care for Medicare Advantage and commercial insurance members throughout the commonwealth. Terms of the deal were not disclosed.

MCS is the 14th largest MA plan and the seventh largest dual-eligible plan in the U.S, servicing more than 185,000 Medicare Advantage members and 205,000 commercial insurance members.

Enseo receives growth investment from H.I.G. Capital

Enseo, a services provider offering in-room technology solutions for the hospitality, senior living, education, and health care markets, received a growth investment from H.I.G. Capital, an alternative investment firm with $44 billion of capital equity under management. The size of the investment was not disclosed.

AlayaCare raises $225M

Global home and community care software company AlayaCare raised $225 million in CAD Series D funding, led by Generation Investment Management. Other investors include Klass Capital and incumbent investors Inovia Capital, CDPQ, and Investissement Québec.

The post Transactions & Financings: Enso Village Closes $297M Bond Funding; Acts Retirement-Life Communities Bond Rating Affirmed appeared first on Senior Housing News.

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