HJ Sims Provides $4.3 Million
Mezzanine Loan for Skilled Nursing
Acquisition
Partnered Right®
A national recognized owner and operator of healthcare properties and services (the “Sponsor”) was pursuing the acquisition of a skilled nursing
community (the “Community”). The Sponsor owns and operates substantial portfolio of healthcare properties across several states. HJ Sims previously partnered with the Sponsor on three separate financings dating back to 2019 including two mezzanine loans and most recently, a high leverage
first-mortgage uni-tranche loan.
Structured Right®
HJ Sims was approached by a representative of the Sponsor to provide subordinate financing to supplement a senior loan in funding the acquisition of the Community. As part of its acquisition plan, the Sponsor identified and planned to implement multiple operational improvements to improve financial performance. After implementing the planned operational improvements, the Sponsor intended to seek permanent financing to refinance outstanding debt. HJ Sims proposed a subordinate mezzanine loan providing additional leverage to fund the acquisition, limiting the out-of-pocket equity requirement from the Sponsor.
Executed Right®
HJ Sims provided a $4.3 million mezzanine loan, which in combination with a senior loan and equity from the Sponsor was used to fund the acquisition. HJ Sims structured the mezzanine loan with a three-year interest-only term, matching the term of the senior loan. The subordinate loan carries a fixed interest rate, ensuring a fixed cost of capital in an uncertain interest rate environment. Through an affiliate of Herbert J. Sims Investments, LLC (“HJSI”), HJ Sims sold securities through its Private Client Group to fund the mezzanine loan.
Financed Right®
The HJ Sims’ mezzanine loan fit the needs of the client, providing a high-leverage solution allowing the Sponsor to, (a) better allocate capital for other acquisition targets and support of existing assets, and to (b) avoid diluting ownership in the Community from taking on additional equity partners.
HJ Sims excels in providing customized debt and equity capital for senior living providers utilizing a variety of direct financing solutions including equity, preferred equity, mezzanine debt, and high leverage first mortgage loans, tailored to meet the unique financing needs of valued partners.
Curtis King
512.519.5003
Brett Edwards
512.519.5001
Brock Bagelman
512.519.5005
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