An Exclusive Investment Opportunity: Toby and Leon Cooperman Sinai Residences at Boca Raton

**This financing has been successfully closed. Please contact you advisor for any potential secondary market opportunities.**


$143,745,000*
Palm Beach County Health Facilities Authority
Series 2020A Long Term Fixed Rate Bonds $56,645,000
Series 2020B-1 Entrance Fee Principal Redemption BondsSM $29,030,000
Series 2020B-2 Entrance Fee Principal Redemption BondsSM $58,070,000
(SINAI RESIDENCES PHASE II EXPANSION)

HJ Sims is pleased to serve as the sole underwriter for Toby and Leon Cooperman Sinai Residences of Boca Raton (Sinai) to fund an expansion via the sale of tax-exempt, long-term, fixed rate and tax-exempt Entrance-fee Principal RedemptionSM bonds. In 2014, HJ Sims served as senior managing underwriter for the municipal revenue for Phase I of Sinai, a continuing care retirement community located in Boca Raton, Florida. Federation CCRC Operations Corp. is a Florida 501(c)(3) located on the campus of the Jewish Federation of South Palm Beach County (The Federation) in Boca Raton, Florida. The site is known as/dba The Toby and Leon Cooperman Sinai Residences of Boca Raton. Sinai’s initial independent living units became available for occupancy in January 2016, and were almost fully occupied within six months, with 100% occupancy occurring 11 months after opening. Sinai’s currenlty consists of 234 independent living units, 48 assisted living units, 24 memory support units and 60 Skilled Nursing Rooms.

Artist's Rendering; subject to change

Virtual Site Visits/Tours

Please find links below to virtual tours of the existing campus, expansion project and floor plans:

About the Bonds

  • Series 2020A
    • $54,110,000
    • Non-rated, tax-exempt
    • Bonds are exempt from Federal Income Tax and exempt from State of Florida Income Tax
    • Denominations of $5,000
    • Interest will be payable on June 1 and December 1 of each year, commencing December 1, 2020
    • Final maturity: June 1 2055
  • Series 2020B-1
    • $29,030,000
    • Non-rated, tax-exempt Entrance-fee Principal RedemptionSM bonds
    • Bonds are exempt from Federal Income Tax and exempt from State of Florida Income Tax
    • Denominations of $5,000
    • Interest will be payable on June 1 and December 1 of each year, commencing December 1, 2020
    • Final Maturity: June 1, 2027
  • Series 2020B-2
    • $53,070,000
    • Non-rated, tax-exempt Entrance-fee Principal RedemptionSM
    • Bonds are exempt from Federal Income Tax and exempt from State of Florida Income Tax
    • Denominations: $5,000
    • Interest will be payable on June 1 and December 1 of each year, commencing on December 1, 2020
    • Final maturity: June 1, 2025
  • Series 2020C
      • $5,000,000
      • Non-rated, TAXABLE Entrance-fee Principal RedemptionSM
      • Exempt from State of Florida Income Tax
      • Denominations: $5,000
      • Interest will be payable on June 1 and December 1 of each year, commencing on December 1, 2020
      • Final maturity: June 1, 2024
    •  

 Use of Proceeds

  • Phase II Expansion Project
    • The new expansion project will be located on 4.6 acres of the southeast portion of Sinai’s existing 21-acre campus.
    • Low-rise buildings encompassing 111 new independent living units, common and green space, dining facilities and a resort-style pool.
    • The project will include approximately 240,000 in total square footage.
    • The expansion contains a variety of independent living configurations ranging from 880 square feet (one-bedroom) to 3,200 square feet (Valencia) with an average of 1,357 square feet.
    • Monthly service fees will average $5,381 and entrance fees will average $867,721 for all expansion units.
    • Currently, there are 73 depositors reflecting a pre-sale rate of 65.8%.
    • Of the 73 depositors, the average age is 85-years-old, depositor median annual income is $222,000, and depositor median net-worth is $4,593,000.

 Security

  • Interest in amounts of deposit, and gross revenue, including Entrance Fees and accounts receivable
  • Personal property and real estate lien
  • Interest in Debt Service Reserve Fund, Working Capital Fund, Coverage Support Fund and Entrance Fee Fund 

 Key Financial Covenants

  • Debt service coverage ratio of 1.20x (tested annually, reported quarterly)
  • Liquidity covenant of 150 days cash-on-hand (tested semi-annually

We are currently accepting indications of interest for these tax-exempt and taxable bonds with an expected pricing week of August 31, 2020, and anticipated settlement September 15, 2020. For more information including risks, please read the Preliminary Official Statement in its entirety. If you have interest in purchasing these bonds, please contact your HJ Sims financial advisor, as soon as possible.

*Subject to change

No dealer, broker, salesperson, or other person has been authorized to give any information or to make any representation other than those contained in the Preliminary Official Statement and, if given or made, such other information or representation should not be relied upon as having been authorized by the Issuer, the Borrower, or the Underwriters. The information set forth herein has been obtained from the Issuer, Borrower, and other sources that are believed to be reliable, but is not guaranteed as to accuracy or completeness by, and is not construed as a representation of, the Underwriters. The information contained herein is subject to change without notice. Under no circumstances shall this constitute an offer to sell or solicitation of an offer to buy, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. Any offering or solicitation will be made only to investors pursuant to the Preliminary Official Statement, which should be read in its entirety. Investments involve risk including the possible loss of principal. HJ Sims is a member of FINRA and SIPC, and is not affiliated with Tony and Leon Cooperman Sinai Residences of Boca Raton.

Market Commentary: Sticker Shock

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Municipal bonds advanced in price again last week on the strength of extraordinary cash balances and an absence of sufficient supply. Yields fell to their lowest point in 70 years. Looking for places to reinvest the $22 billion from bond redemptions and maturities on August 1, 2020, investors added another $1.4 billion to tax-exempt mutual bond funds last week and $229 million to muni ETFs. The modest new issue calendar of $8.1 billion was quickly absorbed by buyers who are waiting impatiently in line for more. The State of Hawaii brought a $995 million AA+ rated taxable general obligation deal with a maximum yield of 2.293% in 2040. Phoenix Children’s Hospital had a $245 million A1-rated financing with a final term maturity in 2050 yielding 2.12%. In the secondary market, MMA reported on the sticker shock, citing 5% San Francisco general obligation bonds due in 2025 traded at yields as low as 0.07%. In the high yield sector, the Academy of Advanced Learning charter school on Aurora, Colorado came to market with an $8.5 million BB rated transaction that priced at par to yield 4.375% in 2027. The Bond Buyer Municipal Bond Index (based on 40 long-term bond prices) fell two basis points to 3.52% from the week before. The 20-bond GO Index (20-year general obligation yields) dropped seven basis points to 2.02%. The 11-bond GO Index (higher grade 11-year GOs) declined to 1.55%. The Revenue Bond Index decreased seven basis points to 2.44%.

Munis are not the only products in great demand. Initial public offerings are on track to hit highs not seen since the 2000 tech boom.  Equities, as defined by the Dow Industrial, gained slightly more than a thousand points last week to close at 27,433. Gold prices hit an all-time high last week with spot prices climbing as high as $2,070 an ounce. U.S. corporate high yield bond fund inflows totaled $4.39 billion last week and the primary market saw $21 billion of new high yield bonds issued; the year-to-date volume now totals $260 billion. The average yield on investment grade corporate bonds at 1.82% is at an all-time low. There is also an unquenchable thirst for U.S. Treasuries where new issue supply is much heavier and there is a worldwide hunt for yield as the level of negative yielding debt exceeds $14 trillion. This is indeed fortunate as the Treasury plans to sell a record $112 billion in notes and bonds in this week’s refunding auctions. The three-month Treasury finished last week at a 0.09% yield, the 10-year Treasury at 0.56% and the 30-year Treasury at 1.22%

All of  this remains hard to reconcile in the context of quarterly U.S. earnings reports and economic data which, while above expectations, are nevertheless ghastly; rising coronavirus counts that terrify teachers, troopers and tight ends; the looting and riots damaging so many of America’s great cities; trade combat, more often described as “tensions”, with China; pollsters paid to support divisive narratives; fall election lineups featuring consequential face-offs; and inscrutable political strategies holding up the next national fiscal aid package, just to name a few. This is our status quo through Labor Day — and perhaps until November 3. 

We continue to focus on the positives but look under all the proverbial hoods and kick all the tires in our daily analytic, surveillance, and trading work. We encourage you to contact your HJ Sims advisor to review the credit fundamentals in your portfolio, as well as in new offerings we see every day that may be suited to your risk profile and worthy of your investment.

Market Commentary: Groundhog Day

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The 1993 box office hit starring Bill Murray portrayed a TV weatherman from Pittsburgh sent with his producer to cover the annual shadow-no shadow show in Punxsutawney, Pennsylvania which, for 120 years, has produced legendary forecasts of early spring or extended winter. He soon becomes trapped in a time loop nightmare that causes him to relive the events of February 2 with the townies over and over and over again. The movie, which was actually filmed in Woodstock and Cary, Illinois with an unknown woodchuck, became one of the most popular romantic comedies of all time and “groundhog day” became our new term for being stuck in a job or life that is mind-numbingly repetitive and unpleasant.

Groundhog Day is the cycle that many of us find ourselves in for five going on six months now. On the personal front, we smack the same alarm button every morning not knowing if is in fact Wednesday or Sunday, April or August. We are mostly limited to our homes, in mostly small spaces, often with family but sometimes alone, and venture out at our risk with mask and gloves to work, shop, or just get some air. Like the character Phil Connors, some of us try counseling, take side jobs, reach out to help others in need, learn to play the piano, fall in love. Others eat and drink too much, lash out, spend unwisely, take crazy gambles. On the work front, our lives are mostly inextricably linked with the very same spaces, people, events and risks. In many ways, our days are as Yogi Berra once said, “déjà vu all over again”. And try as we might to find humor in our daily routines, exercise, socialize with our family and friends, or make plans for the future, these efforts, once so normal and natural, have become a tiresome chore amid restrictions that were tolerable for 15 or 30 or 60 days but now seem quite permanent. We suddenly long for the good old days, no matter how lousy they may have seemed back a mere six months ago, pre-Covid.

The financial markets have generally loved the Groundhog Day cycle since late March, in the same way they have loved all the vaccines administered by the Federal Reserve for the past 11 years. They have saved us from inflation, depression, and most undesirable losses. While federal and state pandemic control-related policies have devastated small businesses and caused communities to split over what to do about schools, prisons, churches, nursing homes, taxes and the kind of government we want after November 3, as investors we have been reliving a reel of rallies.

Last week, as Fitch Ratings lowered the outlook of the United States of America to “Negative” from “Stable,” the 10-year Treasury yield fell to its lowest level not in decades but in centuries — 234 years to be exact — at 0.52% and the $20 trillion market saw volatility fall to a record low. During July, the benchmark yield dropped 13 basis points, the 2-year sank 4 basis points to 0.10% and the 30-year plunged 22 basis points to 1.19%. At this writing, there is speculation that the entire Treasury yield curve will soon be under 1%.

The Nasdaq, just having hit its 30th record high in 2020, added more than 686 points in July, closing at 10,745. The Dow gained 615 points to finish at 26,428. The S&P 500 ended up 5.5% at 3,271. The Russell 2000 climbed 39 points to 1,480. Reuters recently reported that the average holding period for U.S. shares has dropped to 5.5 months versus 8.5 months in December; this is a new record low, beating the turnover seen during 2008 crisis and reflecting investor fear of missing out juxtaposed against the terror of owning overpriced stocks in illiquid market. Oil prices rose $1 a barrel to $40.27. Gold prices spiked 10.8% to $1,975 an ounce and has since crossed the historic $2,000 mark. Gold is up 35% this year, making it one of the best performing assets so far alongside silver which at $26.80 is up more than 50%.

Despite weakening state and local credit fundamentals resulting from the Covid-depressed economy, the municipal bond market is soaring higher based on technical factors that include light tax-exempt supply, strong demand, buyers significantly outnumbering sellers since march 17, lots of excess cash from summer bond calls, coupons and maturities, light dealer inventories, and a steady stream of inflows for 12 consecutive weeks into muni bond ETFs and mutual funds. In July, $7.5 billion was added to mutual funds and the muni rally continued. July issuance was actually the highest in 34 years at $42.6 billion but 35% of the total came in the form of taxable bonds. Year-to-date issuance of corporate bonds by non-profits is twelve times higher than it was last year. The general market was up 1.3% with strong performances by zero coupon bonds. The high yield sector gained 1.2%, and taxable munis outperformed with returns of 2.3%. During the month, the 2-year tax-exempt AAA municipal general obligation bond yield went from 0.27% to 0.13%, the 10-year from 0.90% to 0.65% and the 30-year from 1.63% to 1.37%. The 10-year muni-Treasury ratio currently stands at 124.8%.

In the muni primary market last week, the Public Finance Authority sold $18.4 million of BB-minus rated charter school revenue bonds for Founders Academy of Las Vegas that came with a 2055 maturity priced at 5.00% to 4.59%. In the high yield corporate market, Seaworld Entertainment had a 5-year non-call deal, upsized from $400 to $500 million, with more than $2 billion of orders that priced at par to yield 9.50%. In the corporate bond sector, investment grade bonds gained 2.9% in July while high yield climbed 3.9% and more than half of high yield borrowers had total returns that higher than that, up to 24.8%. Higher rated issuance slowed to $65 billion and high yield deal volume totaled only $25 billion. This week, investors will see 20% of the companies in the S&P 500 index report quarterly earnings. There are approximately $30 billion of investment grade deals on the calendar and $13 billion of high yield deals have priced already as of Wednesday morning. The muni slate totals approximately $7.3 billion.

U.S. markets are not reflecting the condition of an economy that posted gross domestic product of negative 32.9% in the second quarter and is still struggling with how to track and contain the SARS-CoV-2 virus. But performance must be viewed in a global context where negative yielding debt totals $14.3 trillion and there is a worldwide hunt for any yield. In addition, the Fed is suppressing rates at zero, extending its crisis lending through December, and pledging to do whatever else it takes to overcome a downturn characterized by the Chair as the most severe in our lifetimes. The Fed’s balance sheet has expanded to $7 trillion and may well grow to $11 trillion by year-end. There is no agreement between the House, Senate and White House on the terms of the next stimulus, but this has long been expected to wrap up by Friday when the Senate recess is scheduled to begin. The good news will help to reduce fallout from the weak July jobs numbers also expected on that day and the damage wrought by Hurricane Isaias up and down the East Coast.

Market Commentary: Investment Ballpark

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The investment ballpark, much like every stadium across the country, looks different at this point in the season. It has changed as a result of the coronavirus and is still morphing as major players study the whole lineup of social unrest, campaign platforms, and this start-and-stop economic recovery with its unprecedented unemployment, school and business closures, and financial pressures that caused nearly one third of all Americans to miss their housing payments due on July 1. In the same way that Major League Baseball has been struggling with health and safety issues affecting players and fans to determine the future of the game amid alarming increases in cases, conventional financial analysts taking in all these unsettling conditions might deem most investments ill-advised at this time, perhaps none more so than the obligations of state and local government whose revenues have plummeted alongside incomes and sales.

There are some 65,000 individual municipal borrowers with about a million different credits outstanding. Many are general obligations of state and local governments stressed by six months of tax streams that have dried up and a gush of unexpected social spending. Some are backed by specific revenues that have been more impacted than others. Common problems for all are compounded for some by issues stemming from trade wars, court decisions, violent crime, and population moves. Many government and nonprofit borrowers began the year with robust rainy day funds — but plenty of others did not and their best laid plans have been scuttled by Covid-19 related shutdowns. Urgent needs and wish lists have been exchanged with Congress, but the terms of a fifth federal aid package have yet to be determined at this writing. In the meantime, in spite of all the facts and headlines, the 11-week rally continues and municipal bonds are advancing steadily once again. Last week, the 10-year tax-exempt AAA general obligation benchmark yields fell another 4 basis points to 0.71% right alongside U.S. Treasuries, which fell like a sinking fastball from 0.63% to 0.59%. The 30-year muni yield also dropped 4 basis points to 1.43% while the long bond boosted its slugging percentage such that its yield fell a full 10 basis points to 1.23%.

Several factors contribute to the string of rising bond prices. First, the Federal Reserve has not only held rates near zero but also positioned itself as the equivalent of a baseball backstop for both municipal and corporate bonds with liquidity programs that have lulled markets into thinking they are protected from wild pitches. Second, whether or not historic data is relevant to the current times, analysts continue to point to an “error rate” for munis that remains extremely low. Moody’s data from 1970 through 2019 shows that the average five-year annual default rate for its rated municipal bonds was 0.08%. Corporate bonds, which have lower ratings, had a 6.7% default rate over the same period. Third, cash that has been sitting on the sidelines continues to pour into the mutual funds and ETFs from households and institutions; Lipper reported $2.1 billion of municipal inflows and $11 billion of taxable bond fund inflows for the week ended July 22. Fourth, many corporations have paused or cut stock dividends, causing some to exit the equity markets and look to the bond markets for less volatile and more reliable sources of income.

A fifth factor, and one of the most significant, involves the supply/demand imbalance. The low rate environment and need to bolster liquidity to survive a pandemic of uncertain length and effect, has caused a record surge in taxable bond issuance. The U.S. Treasury has borrowed more than $3.4 trillion as of June 30 and plans another $677 billion of debt issuance by the end of the third quarter. Corporation have issued more than $1.2 trillion of investment grade debt and $230 billion of below-investment grade debt so far this year. The year-to-date supply of municipal bonds totals $239 billion, up 25% from last year at this time, despite the pullback in issuance during volatile conditions in March. But an increasing percentage of this debt is coming in the form of taxable issues for hospitals, colleges and large borrowers refinancing debt under the 2018 tax law. So far this year there have been about $69 billion of taxable munis issued; this month, taxable munis are expected to exceed 50% of new issuance according to Municipal Market Advisors. This exacerbates the supply/demand imbalance for tax-exempts which are being sought in great part to offset the loss of state and local tax deduction. The loss was felt by millions again on July 15, the tax filing deadline that was extended due to the coronavirus.

Major bondbuyers — life, property and casualty insurers, pension funds, and foreign institutions have become switch hitters — crossing over into the muni space historically dominated by U.S. households. As sovereign and corporate yields have plummeted under fiscal and monetary policy, and negative yielding debt approaches $15 trillion, tax-exempt and taxable U.S. muni yields are waving buyers in like a third base coach. The 30-year A rated taxable muni yield was 2.94% on Monday, versus 2.76% for the comparable A rated corporate maturity and 1.88% for the comparable A rated tax-exempt.

As we approach August 1, the municipal market is expected to see the largest of the year’s major coupon, call, and principal maturities deliver even more cash to an undersupplied market. Investors will not find as much in the way of pinch runners as they would like. Yields are lower across the board. Dealer inventories are at also at historic lows. Many of the bonds in the few bid-wanted “rosters” in circulation have yields so low that they are in fact negative after accounting for fees and inflation.

The new issue market has been the only game in town for buyers of yield. This week’s calendar will likely come in under $7 billion, so there will not be enough to go around. Last week in the high yield sector, we saw five charter schools. Warren Academy of Michigan came to market with a non-rated $9.6 million limited offering structured with a 30-year maturity that priced at a premium 5.50% to yield 5.45%. Landmark Academy in Michigan sold $13.4 million of BB rated bonds that had a maximum yield of 5.00% in 2045. The College Prep Middle School in Spring Valley, California placed $12 million of non-rated bonds at par to yield 5.00%. MAST Community Charter School in Philadelphia had a $27.7 million financing with BBB-minus rated bonds structured with a 2050 term maturity priced with a 5.00% coupon to yield 3.32%. And Renaissance Charter in Florida borrowed $66.1 million in a non-rated financing that included 30 year bonds priced at 5.00% to yield 4.375%. The Sweet Galilee at the Wigwam assisted living community in Anderson, Indiana brought a $22.4 million non-rated transaction priced at par to yield 5.375% in 2040. The White River Health System in Arkansas had $32.6 million BBB-minus rated bonds issued through the City of Batesville that had a final maturity in 2032 priced with a coupon of 3.25% at a discount to yield 3.35%. McLean Affiliates in Simsbury, Connecticut brought a $64.8 million BB+ rated bond financing due in 2026 and priced at par to yield 2.75%. And Navistar International Corporation had a $225 million B3 rated financing priced at par to yield 4.75% in 20 years.

U.S. Corporations are in the process of reporting second quarter earnings which, while devastating, are in many cases slightly better than feared. Through last Friday, more than a quarter of S&P 500 companies have announced results. Losses larger than those taken at the height of the last recession have not, however, steered investors away from the stock or corporate bond markets. The Dow gave up 202 points last week to close at 26,469. The index is down 7.25% on the year but has crawled back from its March low of 18,591. The S&P 500 lost 9 points but has erased nearly all its early season pandemic loss and is nearly flat in 2020. A handful of all-star technology stocks have caused The Nasdaq to outperform; although the index fell 140 points last week, is up 15.5% this year. Oil held steady at $41.29 but is off 32% since January. Gold has rallied to record highs; last week prices per ounce rose $92 or 5% and are currently 28% or $473 higher than where they started the year.

HJ Sims has been working with a number of nonprofit and for-profit borrowers to help them take advantage of current market conditions and opportunities. Our traders and advisors have been proactive in working with our investing clients on portfolio reviews, swaps and recommendations for strategically putting free cash to work. We are closely following some of the trends in credit impairments and encourage careful and regular professional surveillance of holdings to ensure that current risk limits and future income needs are in line. Those taking summer staycations, those with time to spare when MLB games are postponed, and those doing quarterly or mid-year reviews can benefit from a conversation with their HJ Sims advisors.lk

Market Commentary: The Storm of Alternative Currency

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One hour east of Austin, the small post-industrial city of Rockdale, Texas has been suffering through a bit of an identity crisis. Its roots date back to 1873 and its history is largely tied to the expansion of railroad lines hauling local cotton and coal. The salad days for this community began in 1920 when oil was first discovered. Life there only got better in 1952 when the Aluminum Company of America opened the largest smelting operation in the country, eventually producing 1.67 million pounds of aluminum a day for use in everything from U.S. skyscrapers to fighter planes. A Saturday Evening Post article immediately featured Rockdale as “The Little Town That Rained Money”, and these were happy days for everyone. Governing recently reported that, together with the adjacent power plant and mine, Rockdale Works employed about 2,000 locals at its peak. But in 2008, the company announced that it was shutting down all aluminum production due to market conditions. The plant started laying off workers and finally closed in 2014.

Things reached rock bottom for the small city and surrounding Milam County when both local hospitals closed, but then two miracles occurred. The high school football team won the 2017 state championship and the big Chinese company Bitmain arrived with a $500 million plan to build a mammoth plant with 325,000 cryptocurrency mining computers on the old Alcoa site. Unfortunately, the price of bitcoin plummeted in 2018, and the project was dramatically scaled back.

There was national media coverage of Rockdale’s bad turn of events, however, and the area came to attract the attention of another company: the Whinstone Group, a subsidiary of Germany’s Northern Data AG. Whinstone is now constructing one of the largest bitcoin computing mines in the world in Rockdale. So, there are now two crypto mining operations setting up rows of tall computer servers running the lengths of multiple hometown “Tiger” football fields. These mining machines will be used to build a blockchain needed to unlock as much as possible of the limited supply of bitcoins that becomes available. The world’s top operators run thousands of miners and consume massive amounts of electricity to obtain the cryptocurrency, but facilities in this city, county and state are now becoming global competitors. Texas has formed a Blockchain Council to make the state a leader in national blockchain growth, education and business development. Rockdale is simply hoping to become the Little Town That Rained Cryptocurrency.

Bitcoin, first proposed by an anonymous programmer in a 2008 white paper, is a decentralized, independent, digital currency, not regulated or associated with any one country or authorized by a central issuer. It made the headlines this week when Twitter was hacked and several noteworthy user accounts were used to post a crypto giveaway scam. Some consider cryptocurrencies to be worthless or fraudulent and there has been talk of a U.S. ban, but others such as the former chair of the Commodity Futures Trading Commission are lobbying for a U.S. central bank digital currency.

The cryptocurrency creation process is hard to explain as are the transactions which are performed in a network maintained by miners who process and verify them through algorithms. But there is no doubt that institutional demand for the end product is growing; Grayscale’s Bitcoin Investment Trust reported $1 billion of inflows in the most recent quarter. In addition, the pandemic has caused something of a coin shortage such that some banks are offering $5 for every $100 worth of coins brought in from piggy banks and couch cushions. Many businesses are no longer accepting paper currency for fear that it can be a vector for spreading coronavirus.

These days, we find that our lives and routines are changing in so many ways, perhaps permanently. Alternative currencies may in fact continue to become more popular. Major companies including AT&T, Expedia, Microsoft, and PayPal already accept cryptocurrency. At the time of this writing, one bitcoin is worth $9,361.16, up from $5,082.26 in mid-March, but down from its all-time high of $18,571.57 in late December 2017.

Money is all forms is central to every discussion at present. Federal grants and loans have rained on America since March. The Administration and Congress are debating a fifth aid package to extend unemployment assistance and provide additional funding for essential service providers. Furloughed workers are taking withdrawals from retirement accounts. Households are adjusting budgets to meet the new realities created by the pandemic. Students considering a return to campus are negotiating with colleges for more financial aid. Caribbean nations are selling residency certificates, passports and citizenships for major contributions. Corporations are borrowing at record paces. State and local governments, agencies, and nonprofits faced with major revenue losses are taking on new debt at very low rates and lots of investors are wrestling for access to their bonds. OPEC+ is adjusting production limits to maintain prices in the $40-$50 range. Law firms are filing wrongful Covid-19 death tort lawsuits in pursuit of high-dollar damages or settlements. With only 100 days to go until election day, political candidates are asking for lots more donations.

Earnings season began and the first few 2Q20 reports were terrible, as expected, but not as awful as some feared. Covid-19 cases have been increasing, the prospects for recovery remain uncertain, and many cities and states are starting to reverse some re-openings. But traders continue to look to every bright side. The Nasdaq has hit another all-time high and has gained 4.4% since the start of July; the Dow is up 3.3% and the S&P 500 has gained 4%. The investment grade corporate bond calendar totaled $11 billion last week, bringing the year-to-date total to an astonishing $1.2 trillion. The high yield corporate slate, led by Carnival Cruise and Norwegian, added up to $6 billion and mutual fund inflows exceeded $840 million. On the commodity side, gold futures have seen 6 weeks of gains. Oil prices have climbed 3.4% to $40.59 a barrel and gold is up 1.5% to $ 1,810 per ounce.

The U.S. Treasury has also strengthened in July, although not as much as tax-exempts. The 2-year is flat on the month at 0.14%, the 10- year yield is down 3 basis points to 0.62% and the 30-year at 1.32% has fallen 9 basis points. In the municipal bond market, customer selling was at the low point of the year last week and investors are refusing to part with their higher coupon holdings. Primary dealer inventory is at all-time lows. The new issue calendar this week should exceed $8 billion but that will not be able to satisfy the relentless four month-long demand. As of the close on Friday, the 2 -year muni AAA general obligation benchmark yield has fallen 10 basis points to 0.17% so far in July, the 10-year yield has fallen 15 basis points to 0.75% and the 30-year at 1.47% is down 16 basis points. The only thing placing a lid on a bigger rally is the unbelievable upswing in higher risk equity markets.

Encore on the Lake

HJ Sims completes innovative dual bank senior – supplemental debt financing for Encore on the Lake. This new middle market independent living campus is a planned 80-unit Independent Living Community to be constructed on a 6.8 acre site in North Strabane Township, Washington County, PA.

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Market Commentary: Have We Got This Handled?

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The open prairies, sandstone quarries, and coal mines gracing the land halfway between the cities of Seattle and Portland in Washington attracted many American settlers back in the 1860s and the Town of Tenino became a popular whistle stop on the Northern Pacific Railroad route. The Town’s fifteen minutes of fame came some seventy years later during the Great Depression when the Citizens Bank closed, all bank accounts were frozen, and cash became very scarce. In December 1931, the local chamber of commerce came up with the idea of issuing Tenino Wooden Dollars to restore confidence and spur commerce. The scrip was printed in one-dollar denominations and was redeemable in Thurston County stores during the month it was issued. The alternative currency circulated for two years. Ninety years later, the community decided to break out those old wooden presses again to help workers who have lost income due to the pandemic. Residents are eligible for up to $300 a month to spend for necessities and services from local providers. The bills are made of wood veneer, issued in $25 denominations, and engraved with the Latin phrase Habemus autem sub potestate, translated as “We’ve Got This Handled.”

Communities with less than 2,000 people like Tenino, as well as cities with more than 1.5 million across the country and around the world have been taking maximum advantage of state, federal and private aid but have also been coming up with their own creative solutions to handle a wide range of individual needs as the pandemic rages. A focus on the health and safety of neighbors, customers and employees is in fact contributing to the demise of coin and currency usage. Cashless, contactless transactions have been increasing as case counts have surged. At this writing, there are more than 3.4 million confirmed cases in the U.S. and there have been 136,463 deaths. The Centers for Disease Control reports an overall cumulative Covid-19 hospitalization rate at 107.2 per 100,000, and the median cost of each stay is $45,000. The number of employed workers has fallen to 137.8 million, down 14.7 million from the 152.5 million reported in February. More than 32.9 million Americans were receiving some type of unemployment assistance as of June 20. At the end of the month we will have the first estimate of second quarter growth but it is estimated to show a drop of at least 30%.

U.S. financial markets appear convinced that there is a fall safety net beneath them, fashioned with the shock absorbing synthetic mesh of the Federal Reserve and the U.S. Treasury. Many investors feel certain that a worsening of the pandemic will only produce more stimulus, making COVID-19 in the words of one trader “inversely related” to market performance. But the massive social and economic disruptions and mitigation response that have produced a $2.7 trillion U.S. budget deficit and $7 trillion Fed balance sheet nine months into the fiscal year seem destined to create at least a few market bubbles.

For five months now, we have been relying on government officials to handle decisions affecting just about every waking hour of our lives. They exercise unprecedented control over our whereabouts and activities and, in the process, we have lost so many of our most pleasant summer distractions. Vacations are being postponed, barbecues limited, beaches closed. We miss seeing our favorite seasonal competitions for baseball’s all-star MVP, the Tour de France’s yellow jersey, the British Open’s Claret Jug, and Wimbledon’s trophies. Instead, we listen to the field chatter of central bank officials, follow the wrestling matches involving teachers’ unions and epidemiologists and parents over fall school openings, make wagers on the changing names of professional football teams, and cheer or boo some of the more unusual alliances formed in recent U.S. Supreme Court opinions. In one such ruling last week, the Court decided that nearly half of Oklahoma is Native American reservation land allocated under an 1866 treaty, suddenly raising a host of new tax, zoning, and law enforcement issues for 39 counties.

This week, taxpayers are scrambling to finish 2019 returns after a three-month blanket extension granted for state and federal filers. Traders are watching the first reports of second quarter corporate earnings, assuming that the worst of the coronavirus impact will be reflected therein, more interested in the forward guidance offered by chief executives and progress on vaccine trials. It is hard to say at this point whether the markets have baked in some of the uglier possible scenarios. The S&P 500 is currently trading at 25 times estimated earnings, the highest point since the era of the dot-coms. It has risen 42% since its low point in March 23. A record $184 billion was raised in U.S. equity capital markets in the second quarter according to Refinitiv IFR data. Investors are also fueling rallies in the bond markets. The $1.2 trillion of investment grade corporate bond issuance in the first half of the year is the highest on record. Municipal bond mutual fund and ETF flows have been positive for 10 consecutive weeks, and the ICE BoAML tax-exempt muni index has seen 10 straight weeks of positive returns.

The municipal bond calendar may total as much as $14 billion this week, with nearly $5 billion coming as federally taxable bonds, led by hospital, college, port and airport deals. The 30-day visible supply exceeds $19.1 billion, a high reached only on seven other occasions according to Municipal Market Advisors. On the corporate bond side, investment grade issuance is expected to come in at $20 billion, bringing us closer to a July total of $100 billion. The high yield corporate calendar changes daily; so far this year, new issue volume adds up to more than $219 billion. At this writing, the 10-year Baa corporate bond yield stands at 3.28%, 11 basis points lower on the month. The 2-year AAA rated municipal general obligation bond yield at 0.24% is down 3 basis points on the month while the 2-year Treasury yield is basically flat at 0.15%. The 10-year muni benchmark yield at 0.81% has fallen 9 basis points, outperforming the Treasury 10-year counterpart, nearly flat at 0.64%. The 30-year muni benchmark yield at 1.53% is 10 basis points lower as compared to the 30-year Treasury at 1.33%, which is down 8 basis points in July. The long muni has not seen a 2-handle or 2% yield since May 7; the long bond has not seen a 2-handle since February 19.

Searstone

Searstone picture

HJ Sims successfully completes $6.6 million of Tax-exempt and Taxable Revenue Bonds to position Samaritan Housing Foundation, Inc., d/b/a Searstone Retirement Community, a life plan community located in Cary, NC, for accretive Phase II.

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HJ Sims 2020 Late Winter Conference Recap

Thank you!

On behalf of the entire HJ Sims Investment Banking team, we want to thank you for attending the 17th Annual HJ Sims Late Winter Conference at the InterContinenal San Diego in San Diego, California. We at HJ Sims are proud of our commitment to furthering conversation about financing methods & operating strategies in the Senior Living Industry. Bringing together a dynamic group of speakers from Non-Profit and Proprietary Senior Living Providers, as well as outside experts with thought-provoking views, it is our goal to have provided profound insight and an invaluable forum for exchanging ideas and information.

We also recognize that our conference was one of the last in-person events that was fortunate to take place. We appreciate those who attended, and we look forward to when we can get together in-person again.

Post-Conference Follow-Up

Our Conference Recap provides comprehensive coverage of the many sessions and event highlights from the 2020 HJ Sims Late Winter Conference.

Highlights include:

  • Keynote speakers from outside the senior living industry who shared valuable ideas from fields like Canyon Ranch® – the leader in luxury health and wellness introduced a potential new concept for senior living communities; Dr. Matthew Lieberman, a dedicated researcher on cognitive social neuroscience where we explored research indicating that we need to be connected socially to be physically and psychologically healthy; and Dr. Robert Genetski, an economist who led a discussion of the current financial markets where we explored principles vital to economic and political freedom.
  • Informal and memorable activities to bolster connection and conversation, included a glorious morning on the waters of San Diego Harbor for sailors and fishing enthusiasts; golfing at the world-renowned Torrey Pines; tasting a sample of San Diego’s best brewery and distillery products; and sharing an incredible evening with friends and a few new animal pals at the famed San Diego Zoo.
  • Educational sessions that covered topics such as: acute and post-acute care, medical and recreational cannabis, serving middle-income seniors, strategies to avoid moving from a stressed to distressed financial or operational situation, and a new approach to incorporating wellness in senior living.

In case you missed it, below are the details from our 17th Annual HJ Sims Late Winter Conference.

Agenda
Schedule and activities
Roster of conference speakers and their biographies

We invite you to watch the highlights of our conference in a recap video that features all the best parts of our conference. We also invite you to view the many beautiful photos from our conference.

Peruse the photo gallery and video montage below, and visit the HJ Sims FacebookInstagramLinkedIn or Twitter pages.

Taco Tuesday Dinner and Reception – LWC2020

San Diego Zoo Reception

Network Breaks

Corporate Social Responsibility: Gift of Life

The Gift of Life (GOL) team was thrilled to provide an update about the strong partnership between HJ Sims and GOL during the last two years, which has helped to promote the registry and subsequently add new donors, as well as supported numerous efforts to advance the GOL mission.

For more information on HJ Sims’ CSR program and Gift of Life, please visit: www.hjsims.com/servingourcommunitites.

Save the Date

Please save the date for next year, the 18th Annual Sims Late Winter Conference at the Sarasota Hyatt Regency, Sarasota, Florida. While we are still grappling with how we will hold our annual conference, rest assured, we will hold one… more to follow. Stay tuned, and stay healthy.

Thanks again!

HJ Sims Closes Financings for Lenbrook, MRC Manalapan; Partners with Voralto for Acquisition

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CONTACT: Tara Perkins, AVP Marketing Communications | 203-418-9049 | [email protected]

HJ Sims Closes Financings for Lenbrook, MRC Manalapan; Partners with Voralto for Acquisition

FAIRFIELD, CT– HJ Sims (Sims), a privately held investment bank and wealth management firm founded in 1935, is pleased to announce the successful closing of three transactions.

Lenbrook, a life plan community in Atlanta, GA, pursued financing for its recent Kingsboro at Lenbrook expansion. After a successful 2016 refinancing and a 2018 pre-development financing, Lenbrook again retained Sims to manage the financing process for the $107 million project. A priority  of Lenbrook’s was to maximize the ability to deleverage the debt of the financing without penalty. The entrance fee debt was maximized and the long-term debt amortized while permitting early repayment from turnover entrance fees.

 Sims coordinated a request for proposals to gauge interest in both the entrance fee and long-term debt. Due to the COVID-19 impact on bond markets and conduit bond issuers, Sims coordinated with the board and management of Lenbrook to pivot the transaction from tax-exempt financing consisting of bank short-term debt and long-term fixed rate bonds to taxable all-bank financing while closing early and achieving Lenbrook’s goal of maximizing deleveraging while maintaining flexibility. Fitch assigned a BBB- rating with stable outlook.

In Monmouth County, New Jersey, MRC Manalapan (MRC) is developing an assisted living and memory care community. MRC principals (and LV Development) collaborated with Springpoint Senior Living (Springpoint) to arrange the project and contracted with Springpoint to operate the community (Springpoint at Manalapan) under a long-term lease. Sims was engaged to implement debt financing supplemented by equity provided by the MRC principals.

Following a Sims-led solicitation, Peoples United Bank was selected to provide $14.3 million of taxable senior debt financing, incorporating a construction/mini-perm structure with a five-year balloon maturity. The loan includes tiered-interest rate pricing with reductions in loan credit spread following progression from construction, opening and stabilization. Primary security includes a revenue pledge and property mortgage. Supplemental security includes dual guarantees provided by the MRC principals and succeeded at completion by a limited tenant guaranty. Sims, Peoples and the financing team worked diligently with the MRC principals to secure final approvals, successfully closing in mid-May 2020.   

Established in 1977 and headquartered in Houston and Dallas, TX, Voralto is a 42-year-old senior housing owner/operator with a combined 120+ years of experience in the senior housing industry. Committed to growing the company through strategic acquisitions and new developments, Voralto currently owns/operates 8 assets totaling 590 beds in TX and GA. Sims was approached by Voralto to provide equity for the acquisition of an assisted living and memory care community in northern TX. Voralto’s business plan included the implementation of operational changes.

Sims formed a joint venture with Voralto to acquire the community. Sims’ equity provided liquidity to overcome any short-term performance issues resulting from COVID-19 and time to implement the business plan.

Scheduled to close in March, Sims and Voralto overcame challenges from COVID-19. Drawing from expertise of its bankers and investors, Sims underwrote Voralto’s business plan and provided a customized solution.

Financed Right®:

Non-profit: Aaron Rulnick: [email protected] | For-profit: Jeff Sands: [email protected]

HJ SIMS: Founded in 1935, HJ Sims is a privately held investment bank and wealth management firm, headquartered in Fairfield, CT, with nationwide locations. www.hjsims.com. Investments involve risk, including loss of principal. This is not an offer to sell or buy any investment. Past performance is no guarantee of future results. Member FINRA, SIPC. HJ Sims is not affiliated with Lenbrook, MRC Manalapan, Voralto Funding I. Facebook, LinkedIn, Instagram Twitter.

HJ Sims Expands Investment Banking Team to West Coast, Midwest; Grows Private Client Team in Florida, Puerto Rico

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CONTACT: Tara Perkins, AVP Marketing Communications | 203-418-9049 | [email protected]  

HJ Sims Expands Investment Banking Team to West Coast and Midwest; Grows Private Client Team in Florida and Puerto Rico 

FAIRFIELD, CT HJ Sims (Sims), a privately held investment bank and wealth management firm founded in 1935is pleased to announce the addition of two senior bankers as the firm expands with the opening of new offices in the Midwest and on the west coast. 

Lynn Daly joins Sims as Executive Vice President in its new Chicago location with 30+ years of experience working with nonprofit organizations in financing. Daly was acting head of Senior Living Investment Banking at BB&T Capital Markets, where she managed BB&T’s senior living relationships in the Midwest, facilitating financings of $1.3+ billion. Prior to BB&T Capital Markets, Daly spearheaded the Catholic Initiative within senior living investment banking for Ziegler, and served as Head of Allied Irish Bank’s Midwest region. Daly earned a BS in economics from Kalamazoo College, and an MBA from Northwestern University’s Kellogg Graduate School of Management.  

“We are so thrilled to welcome Lynn Daly to the HJ Sims family. Lynn is a well-respected and nationally recognized thought leader in the senior living sector and the perfect leader to grow our presence in the Midwest and to work with our team as we continue to expand throughout the US. Lynn’s extensive experience as both a senior commercial and investment banker, along with her integrity, deep knowledge, and client-centered approach, are vital characteristics and values that will guide our clients and business partners through these challenging times,” said Aaron Rulnick, Managing Principal, Sims. 

Brady Johnson joins Sims as Senior Vice President in its new west coast office, in Orange County, CAPreviously with Hunt Real Estate Capital, Johnson was responsible for real estate debt originations for seniors housing and healthcare properties. He helped establish the firm’s seniors housing real estate lending platform, including a proprietary bridge loan program and expansion of the firm’s agency and HUD financing capabilities. Johnson closed the firm’s first Fannie Mae seniors housing loan, followed by its first seniors housing Freddie Mac loan. Prior to joining Hunt, Johnson served as Director of Seniors Housing & Healthcare at RED Capital Group, and served with GE Capital in various commercial finance roles. Johnson earned an MBA from Thunderbird School of Global Management and Bachelor’s degrees (Economics and Spanish) from the University of Utah.  

“We are excited to welcome Brady Johnson to the Sims family. Brady will help establish our west coast presence serving for-profit and non-profit senior living clients. Brady’s broad experience in FHA, Fannie Mae, Freddie Mac, mezzanine and senior housing financeand his focus on achieving the best solutions for his clients make him a great asset,” said Jeffrey Sands, Managing Principal, Sims. 

In late 2019, Sims expanded its Private Client team, adding aoffice in Jupiter, FLhousing a three-person advisory team, as well as a senior partner of Sims Energy. HJ Sims’ Puerto Rico private client office moved its Guaynabo headquarters to a larger space iMetro Office Park. The spacious quarters enable the team to better host clients, while the expansion reinforces Sims’ established presence and growth on the island. 

HJ SIMS: Founded in 1935HJ Sims is a privately held investment bank and wealth management firm, headquartered in Fairfield, CT, with nationwide locations. www.hjsims.com. Investments involve risk, including loss of principal. This is not an offer to sell or buy any investment. Past performance is no guarantee of future resultsMember FINRA, SIPC. FacebookLinkedInInstagram Twitter. 

HUD Business During a Pandemic

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The COVID-19 virus is having a profound impact on the nation, temporarily, but dramatically, affecting how we live and work. The virus is roiling the capital markets, and policies imposed to slow its spread have ground the economy to a crawl in many quarters. The mortgage banking team at Sims Mortgage Funding has taken to working remotely, linked to each other, our clients and our consulting and business partners electronically, and we will continue to operate this way until the “all clear” sign is announced.

In times of crisis there also is opportunity, and the COVID-19 virus proves no exception. Interest rates for HUD-insured loans have fluctuated wildly over the past few weeks, but the gradual tightening of spreads over the yield on 10-year US Treasuries and steps by the Federal Reserve to ensure liquidity into the government-backed securities markets, improving sale conditions, have created a very favorable climate for interest rates on HUD-insured loans.

How favorable? We are seeing indications of interest around 2.60% for HUD-insured refinancing loans and about 3.30% for construction and substantial rehabilitation loans. Please note that these rates exclude HUD’s annual mortgage insurance premiums, which range from .25% to .77% depending upon such factors as the project type, loan purpose, affordability restrictions, etc. These are terrific rates, reminiscent of what we saw in the HUD-insured loan markets during the Great Recession in 2008.

HUD has taken positive steps to remain operational by working remotely during the COVID-19 crisis. They have established procedures to process mortgage insurance applications and are working with our trade associations and third-party report providers to develop protocols for site and building inspections and appraisals. HUD also has developed arrangements for closings remotely – we’ll soon see how this works as we have a multifamily affordable refinance loan in the Southwest Region just starting the closing process.

HUD’s goal is to conduct business as usual during these difficult times – however, it remains to be seen how the negative economic conditions resulting from a national shutdown of the economy and the effects of COVID-19 on the senior housing sector will impact HUD’s review of new mortgage insurance applications. We are hearing anecdotally that HUD is contemplating increased reserves and other escrows for market-rate construction loans, and potential adjustments to project valuations to account for the impact of COVID-19. More to come there.

One of the central missions of HUD’s mortgage insurance programs is to provide credit support and liquidity to the housing and healthcare/senior capital markets during times of economic difficulty. Given the magnitude of the economic dislocation in the wake of the COVID-19 virus, HUD is expected to play an integral, and necessary, component in our national recovery.

We wish you and your families the best and hope that you are staying safe.

An Update on COVID-19 (Coronavirus)

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As news on the coronavirus (COVID-19) continues to unfold following the declaration of a national emergency, we wanted to stay in touch regarding key details as well as how we may assist you during this unprecedented time. We also recommend following the Centers for Disease Control and Prevention (CDC) and World Health Organization (WHO) for the latest information.

In addition to previous recommendations regarding vigorous hand washing for at least 20 seconds and staying home when feeling ill, recent recommendations have centered on “social distancing” and “flattening the curve.”

Designed to slow down the spread of the virus, social distancing is a public health practice that involves staying at least six feet away from others and avoiding handshakes, hugs or other forms of physical contact. With the aim of preventing the public–-including those who are not yet showing symptoms-–from spreading COVID-19 or other illnesses, it also entails cancellations and closures, as evidenced by the number of school closures and event cancellations. As of March 15, the CDC recommended that gatherings of 50 people or more be avoided for the next eight weeks—it is important to realize this may change by publish date of this article as this is a very fluid situation.

To that end, social distancing can help flatten the curve or reduce spikes in the number of new coronavirus cases, which can stress an already taxed healthcare system. A flattened curve can decrease the spread and lead to better health outcomes for those who do fall ill.

If you are concerned about your investments and the recent market fluctuations, please reach out to your HJ Sims financial advisor at any time. Our team recommends diversifying and investing for the long-term, and we are happy to discuss individual strategies.

Finally, while it is important to stay informed, too much news can also be overwhelming. Do your best to take breaks and take care of yourself.

We want to hear from you

Do you have a topic suggestion for an article in a future issue of Sims Insights newsletter? We would love to hear from you. Share your ideas here.

 

The material presented here is for information purposes only and is not to be considered an offer to buy or sell any security. This report was prepared from sources believed to be reliable but it is not guaranteed as to accuracy and it is not a complete summary of statement of all available data. Information and opinions are current up to the date of publication and are subject to change without notice. The purchase and sale of securities should be conducted on an individual basis considering the risk tolerance and investment objective of each investor and with the advice and counsel of a professional advisor. The opinions expressed by Ms. Morrow are strictly her own and do not necessarily reflect those of Herbert J. Sims & Co., Inc. or their affiliates. This is not a solicitation to buy or an offer to sell any particular investment. All investment involves risk and may result in a loss of principal. Investors should carefully consider their own circumstances before making any investment decision.

Prevention of Coronavirus

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With coronavirus or COVID-19 spreading to more cities, states and countries, awareness and concern also continue to grow. No matter where you live or what your age, it is important to take steps toward protection.

Following are several simple steps you can take to prevent illness and bolster your health:

  • Wash your hands for at least 20 seconds. Even regular hand washers often miss this mark – 20 seconds is about the time it takes to sing “happy birthday” twice. Determine a song of your choice or follow the second hand on your watch to ensure you are washing with soap and warm water for at least 20 seconds. If soap and water are not available, you can use an alcohol-based hand sanitizer that contains at least 60 percent alcohol.
  • Avoid close contact with anyone who is sick, no matter what the illness. If you are caring for someone who is sick, try to wear a mask. The CDC only recommends masks for those who are ill or caring for someone who is sick. Stay home if you feel unwell.
  • Avoid touching your face, particularly your eyes, nose and mouth. Also, avoid shaking hands for the duration of the virus.
  • Clean and disinfect surfaces regularly – this can include commonly touched areas such as doorknobs, light switches, computers, handles, phones, bathroom sinks, counters, toys and more.
  • Take care of your mental and physical health. Make sure you are eating well, drinking plenty of fluids, exercising and doing something to relieve any stress you may feel regarding the virus. Limit screen time, particularly if you find yourself getting overwhelmed by news or social media messages.

With symptoms including fever, cough, shortness of breath and body aches, coronavirus can be confused with influenza. Please contact your doctor’s office with any concerns.

To prepare your household, you can gather a two-week supply of non-perishable food staples and household supplies such as toilet paper, laundry supplies and diapers. It is also recommended to have at least a 30-day supply of prescription medications and other common health supplies (cold medicine, pain relievers) on hand. You may also want to create a plan in case of closure at work, daycare or school.

In addition, you can visit the Centers for Disease Control and Prevention (CDC) site for ongoing updates and information.

We want to hear from you

Do you have a topic suggestion for an article in a future issue of Sims Insights newsletter? We would love to hear from you. Share your ideas here.

 
The material presented here is for information purposes only and is not to be considered an offer to buy or sell any security. This report was prepared from sources believed to be reliable but it is not guaranteed as to accuracy and it is not a complete summary of statement of all available data. Information and opinions are current up to the date of publication and are subject to change without notice. The purchase and sale of securities should be conducted on an individual basis considering the risk tolerance and investment objective of each investor and with the advice and counsel of a professional advisor. The opinions expressed by Ms. Morrow are strictly her own and do not necessarily reflect those of Herbert J. Sims & Co., Inc. or their affiliates. This is not a solicitation to buy or an offer to sell any particular investment. All investment involves risk and may result in a loss of principal. Investors should carefully consider their own circumstances before making any investment decision.

Gift of Life: Recap from 17th Annual Late Winter Conference

Gift of Life (GOL) joined our 17th Annual HJ Sims Late Winter Conference February 25-27 in San Diego. GOL was represented by Alicia Lorio, a leader of their Young Professionals Committee in Orange County; and GOL blood stem cell donor, Alec Nadelle.

Alicia shared GOL’s history and spoke about the importance of growing the GOL stem cell registry to give second chances to those afflicted by blood and bone cancer. Before introducing Alec, Alicia shared how individuals can get involved with GOL and increase the number of those within the registry by encouraging individuals to swab their community and swab at their workplace.

Next, Alec shared his experience with GOL. He donated blood stem cells in November 2012 to a (then 71-year-old) woman battling a fast-moving form of Leukemia. The presentation left attendees feeling truly moved.

The team was excited to share an update about the amazing CSR partnership that HJ Sims and GOL have shared during the last two years.

From running fundraising drives to sponsoring the Steps for Life events to helping underwrite equipment for a
new state-of-the-art Stem Cell Collection Center located in Boca Raton, HJ Sims continues to be honored to support GOL and their mission to cure blood cancer through marrow and stem cell donations. GOL has facilitated nearly 3,600 transplants since its inception.

For more information, visit www.giftoflife.org

How to Cultivate a Green Thumb This Spring

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Gardening and getting your hands a little dirty by digging in the soil can be an incredibly healthy hobby: Gardening can reduce depression and anxiety, help people lose weight, and increase quality of life and overall sense of community, according to Science Direct.

Not everyone, however, is a natural-born gardener – it takes time and trial and error. If your previous efforts at growing plants and flowers, or fruits and vegetables, have been less-than fruitful, there is hope.

Check out the following helpful hints for cultivating your very own green thumb:

  • Relax. Even the best gardeners in the world have made plenty of mistakes. Recognize that Mother Nature can be fickle, weather is not predictable and perfection is not really the goal. Rather, half the fun can be in the planting, watering and watching.
  • Plan. Depending on where you live, you will likely have more success with plants that grow well in that area. The National Gardening Association shares a zone map that can help you learn more about your location and what might grow well there. You can also talk to others about hardy plants that tend to thrive where you live.
  • Enlist help. Invite family or friends to contribute to your garden – kids are often more willing to eat vegetables they have grown themselves – or check out local community gardens. You can quickly double your expertise when you engage others in your planting and growing efforts.
  • Keep it simple. You can consult with a local nursery center to determine the best options for your garden. Peppers, tomatoes, basil, onions and chard as well as sunflowers and dahlias are often great starter choices. You can always expand in the future.
  • Gear up. A shovel and gardening gloves are good tools to have on hand. Garden scissors and a small trowel may also come in handy. Perhaps, some knee pads will offer comfort when you are digging in the dirt, planting seeds and tending to the garden.
  • Water and weed. You will not need to dig into the soil every day, but pay attention to how your garden is looking and growing. Ensure plants are watered regularly and that weeds are removed at least weekly. A little maintenance can go a long way towards creating an attractive and functional garden.

Finally, you can always consult with local experts at the growing number of farmer’s markets, nurseries or gardening groups. Many of these green thumbs would love the chance to share their passion with you and offer more tips on growing a gorgeous garden this year.

We want to hear from you

Do you have a topic suggestion for an article in a future issue of Sims Insights newsletter? We would love to hear from you. Share your ideas here.

 
The material presented here is for information purposes only and is not to be considered an offer to buy or sell any security. This report was prepared from sources believed to be reliable but it is not guaranteed as to accuracy and it is not a complete summary of statement of all available data. Information and opinions are current up to the date of publication and are subject to change without notice. The purchase and sale of securities should be conducted on an individual basis considering the risk tolerance and investment objective of each investor and with the advice and counsel of a professional advisor. The opinions expressed by Ms. Morrow are strictly her own and do not necessarily reflect those of Herbert J. Sims & Co., Inc. or their affiliates. This is not a solicitation to buy or an offer to sell any particular investment. All investment involves risk and may result in a loss of principal. Investors should carefully consider their own circumstances before making any investment decision.

HJ Sims 2019 Late Winter Conference Recap

Thank you!

On behalf of the entire HJ Sims Investment Banking team, we want to thank you for attending the 16th Annual HJ Sims Late Winter Conference at the Sheraton Sand Key Resort in Clearwater Beach, Florida. We at Sims are proud of our commitment to furthering conversation about financing methods & operating strategies in the Senior Living Industry. Bringing together a dynamic group of speakers from Non-Profit and Proprietary Senior Living Providers, as well as outside experts with thought-provoking views, it is our goal to have provided profound insight and an invaluable forum for exchanging ideas and information.

Post-Conference Follow-Up

Our Conference Recap provides comprehensive coverage of the many sessions and event highlights from the 2019 HJ Sims Late Winter Conference.

You can help us make the next Late Winter Conference even more successful by completing this survey. We very much appreciate your input. Thank you.

In case you missed it, below are the details from our 16th Annual HJ Sims Late Winter Conference.

Photos

We invite you to view the many beautiful photos from our conference. Peruse the galleries below and visit the HJ Sims FacebookInstagramLinkedIn or Twitter pages.

For attendees who updated their professional headshots at the “Headshot Hub,” our photographer, Thee Photo Ninja, has posted all headshots in this gallery. Login using the password, sandkey. To download your image, simply click on the photo, and click the download button at the top of the browser.

Activities Photos

We invite you to view photos from the 2019 Late Winter Conference. Then, either view the thumbnails or to view the images as larger icons, click on the image and scroll through.

Shown below are highlights from our recreational activities: Golf Tournament at Innisbrook, Chocolate Making & Tasting at William Dean Chocolates, Sailing on the Kai Lani catamaran and the Schooner Clearwater, Fishing at Hubbard’s Marina and Biking through Dunedin.

While the weather may not have cooperated, it looks like we all managed to have a fun time.

Education Photos

Networking Photos

Corporate Social Responsibility: Gift of Life

Gift of Life (GOL) representatives attended our conference as part of a special presentation at our Opening General Session, which included an introduction to HJ Sims’ Corporate Social Responsibility (CSR) program by Tara Perkins, Assistant Vice President Marketing Communications, HJ Sims, and a screening of the Gift of Life/HJ Sims partnership video. Sharon Kitroser, Corporate and Community Relations Officer, GOL, delivered a short history and shared the donor story of Ryan Corning. Ryan then took the stage to discuss his heartwarming experience—there was not a dry eye in the house! Sharon, Ryan and other GOL staff remained on-site throughout the conference —swabbing, distributing information and answering questions. It was a wonderful experience to share with our attendees.

Kitroser says, “It was truly an honor to join HJ Sims at their Conference. GOL presented our mission to save lives through marrow and stem cell donation, and shared how our partnership has come to life in the past 10 months. We introduced one of our heroic donors…Ryan Corning of Land O’Lakes, Florida who saved 47 year-old New Yorker Julio Rivera, who has survived leukemia thanks to his transplant. Attendees were excited to hear more about how their teams can swab their cheeks to save a life. Plus, more than 30 individuals joined the registry right there at the conference!”

Save the Date

Please save the date for next year, the 17th Annual Sims Late Winter Conference at the InterContinental in San Diego, California.

Thanks again!

Market Commentary: A Matter of Degrees

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The average lifespan back in 1868 was approximately 38.3 years. People were shorter and thinner and suffered all manner of chronic and infectious diseases. Dr. Carl Reinhold August Wunderlich, a German physician, psychiatrist, and medical professor was running the hospital at Leipzig University at that time. In the process of observation and diagnosis, he took the axillary temperatures of 25,000 patients using a foot long thermometer that required 20 minutes to register. Based on the curves he patiently plotted, he determined that fever was not a disease but a symptom, and that the normal human body temperature is 98.6 degrees Fahrenheit. His is the measurement that we have since used to determine the gravity of illness in everyone from newborns to centenarians. But the human body has changed over the years and researchers have been disputing the Wunderlich axiom since the early 1990’s. The latest of two dozen modern studies is from Stanford University, where researchers finds that the new normal is closer to 97.5 degrees. But, as one might imagine, revising the cherished dictums on clinical thermometry is a not a speedy process.

In Wuhan, China and in clinics, hospitals and doctor’s offices around the word, degrees matter. Temperatures of 99.1 or higher are raising alarms as possible symptoms of a coronavirus that causes a lethal form of pneumonia. Dry cough, muscle pain and fatigue may also present over the course of a week before an infected person feels ill enough to seek medical care. At this writing, there are 4,585 confirmed cases in 18 countries and the death toll has reached 106. The rapid spread of the disease has spurred herculean efforts on the part of health professionals and chilling fears among travelers and investors who recall the spread of severe acute respiratory syndrome (SARS) in 2002 and the Ebola virus in 2014.

Global financial markets, which have already withstood the shocks of U.S.-Iran hostilities, the U.S-China trade conflict, the approach of Brexit, and the impeachment trial of a U.S. president in the first three weeks of the New Year, became roiled again on Monday. Even though health officials remind us that the influenza has resulted in 12,000 to 79,000 deaths annually since 2010, reports on the spread of a mysterious virus caused a one-day selloff in stocks on exchanges in Asia, the U.S. and Europe. Bloomberg reported that the slide wiped about $1.5 trillion off the value of world stocks in one week. The Dow erased the entire month’s gains and the Russell 2000 fell 1.5%. Oil prices fell 13% to $53.14 per barrel and gold gained $57.41 an ounce. Money quickly shifted to bonds and the dollar until Tuesday, when traders viewed the degree of global containment effort as likely to prevent a major economic loss. So far in 2020, the 2-year Treasury yield at 1.44% is up 12 basis points. The 10- and 30-year yields have plunged 31 basis points to 1.60% and 2.05%, respectively. Alongside governments, 10-year Baa-rated corporate bond yields have fallen 29 basis points and both the 10- and 30-year AAA municipal bond benchmark yields are down 26 basis points to 1.18% and 1.83%.

Markets focused on the possible implications of an epidemic in China leading to a global health emergency would otherwise be obsessed with Thursday’s Gross Domestic Product number, Friday’s British farewell to the European Union, wagers expected to total $6 billion on Sunday’s Super Bowl, and Wednesday’s meeting of the Federal Open Market Committee, the first such gathering of the year. Voters this year present as a few degrees more dovish, as the Fed Presidents from Kansas City and Boston relinquish their seats to the Fed Presidents from Cleveland, Philadelphia, Dallas and Minneapolis. There are still two vacancies for the Board of Governors and the nominees await Senate confirmation. Investors will watch the press conference and take the proverbial temperature of the Chair and Committee members on inflation, repurchase agreements, and the virus. Futures trading reflects only a 12% chance of a rate hike.

The municipal market is expected to see only $5.7 billion of new issues this week and the 30-day visible supply totals a mere $10.1 billion while redemptions and maturities are expected to add $25.8 billion of cash to the yearlong manhunt for tax-exempt and taxable municipal bonds. The largest financings happen to be for hospitals in Florida and New York, and there are several other health system issues in North Carolina, Indiana and Ohio on the slate. In the high yield space, the Port of Beaumont, Texas has a $265 million non-rated issue with tax-exempt and taxable series for the Jefferson Gulf Coast Project, Howard University is bringing a $145.4 million BBB-minus rated taxable refunding with a corporate CUSIP. And the California Enterprise Development Authority has a $9.2 million Ba2 rated financing for the Academy for Academic Excellence.

From the world of academia, Dr. Matthew Lieberman will be a keynote speaker at the 17th Annual HJ Sims Late Winter Conference next month in San Diego. Professor Lieberman holds degrees from Rutgers and Harvard and directs the Social Cognitive Neuroscience Lab at UCLA, one of the first labs to combine social psychology and neuroimaging. He measures and maps brain activity to demonstrate how we are wired to have a natural preference for switching from non-social to social tasks, how putting our feelings into words can have a soothing effect on those emotions, and how we might be able to help people who disagree come together without being disagreeable. He contends that our need to connect with others is just as important, if not more, than our basic need for shelter and food. So we invite you to hear his remarks, join us at the InterContinental Hotel, savor dinner at the San Diego Zoo, and enjoy a tremendous networking opportunity by registering at this LINK.

Special Credit Considerations for Seniors

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There is a reason that seniors often have the best credit scores, according to Experian. By the time people retire or reach senior status, they have likely been focusing on credit scores and building or maintaining good credit for a significant span of time, with often-impressive results.

While some people believe that they can relax their credit concerns once they retire, that is not necessarily the case. You will still want – and need – good credit if you decide to move or make updates to your current home, enter an assisted-living facility, or apply for a new credit card that offers great rewards points and perks.

In addition, solid credit scores will enable you to qualify for the best rates when it comes to mortgages and insurance, and can help if you decide to return to the job market, since employers are increasingly checking on applicants’ credit histories before making an offer.

How to earn extra credit

First of all, make a note on your calendar to check your credit report annually to ensure that you are not a victim or fraud – credit reports can also contain costly errors. AnnualCreditReport.com offers a free report once a year. No matter your age or stage, everyone should remain vigilant, particularly in the wake of recent serious data breaches.

Even a stellar credit report can decline if payment history, the biggest portion of your credit score, suddenly dwindles. It is important to keep your credit record active by using your current credit card(s) to pay for groceries, gas, travel and entertainment. You can earn rewards points, organize your bill paying and continue to bolster your credit score by using your cards.

Finally, continue to pay your bills on time, keep credit card balances low and think twice before opening any new accounts. Good payment history, and the longevity of your accounts, should continue to keep your credit score high.

Even if you are relatively debt-free, your credit score still matters.

We want to hear from you

Do you have a topic suggestion for an article in a future issue of Sims Insights newsletter? We would love to hear from you. Share your ideas here.

The material presented here is for information purposes only and is not to be considered an offer to buy or sell any security. This report was prepared from sources believed to be reliable but it is not guaranteed as to accuracy and it is not a complete summary of statement of all available data. Information and opinions are current up to the date of publication and are subject to change without notice. The purchase and sale of securities should be conducted on an individual basis considering the risk tolerance and investment objective of each investor and with the advice and counsel of a professional advisor. The opinions expressed by Ms. Morrow are strictly her own and do not necessarily reflect those of Herbert J. Sims & Co., Inc. or their affiliates. This is not a solicitation to buy or an offer to sell any particular investment. All investment involves risk and may result in a loss of principal. Investors should carefully consider their own circumstances before making any investment decision.

Breaking Bad Online Habits

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By Megan Morrow

January is the month of New Year’s resolutions – exercise more, stop smoking, eat more vegetables, try something new – yet “break bad online habits” is probably not a top 10 resolution, even though it likely should be. As we perform more life tasks online, such as paying bills, downloading new apps, keeping in touch with old friends and sharing funny videos, we do not always pause to think of the best ways to keep our personal data secure and private.

Following are three steps you can take to break your bad online habits and set the stage for a safe and secure 2020:

  1. Avoid using the same passwords over and over again. Granted, it is easier to remember your passwords when they are all a variation of your kids’ names, your address or your birthday, for example. However, when you recycle passwords, a hacker who uncovers one password will have much easier access into the rest of your accounts. You can save your most robust, complicated passwords for financial sites.
  2. Resist the temptation to say “yes” without more careful examination. Scam emails are getting more sophisticated, so it is always wise to verify online requests for money or account access, while many apps will ask for your location or the ability to access other account features. Offer the bare minimum of information when you launch a new app or website and say “no” to most location requests (other than maps, which need to know where you are so they can get you to your next destination).
  3. Lock your devices. Many people assume work laptops are safe and that their phones are usually nearby, thus choosing not to use “lock screen” protections. It only takes a few moments for someone to install spyware or malware on your device or to see confidential information that you have left up regarding clients or your own personal information. This is a simple step that can protect you at work and at home.

Other simple changes you can make to protect yourself include: never check your bank accounts over public wi-fi, pay attention to anti-virus updates, do not click on links or download files from suspicious or strange email addresses, and always take advantage of the free annual opportunity to check your credit report.

While online banking, shopping and communication can offer ease and convenience, they can also lead to identify theft and long-term issues: If you have not already, make online security one of your New Year’s resolutions.

We want to hear from you

Do you have a topic suggestion for an article in a future issue of Sims Insights newsletter? We would love to hear from you. Share your ideas here.

The material presented here is for information purposes only and is not to be considered an offer to buy or sell any security. This report was prepared from sources believed to be reliable but it is not guaranteed as to accuracy and it is not a complete summary of statement of all available data. Information and opinions are current up to the date of publication and are subject to change without notice. The purchase and sale of securities should be conducted on an individual basis considering the risk tolerance and investment objective of each investor and with the advice and counsel of a professional advisor. The opinions expressed by Ms. Morrow are strictly her own and do not necessarily reflect those of Herbert J. Sims & Co., Inc. or their affiliates. This is not a solicitation to buy or an offer to sell any particular investment. All investment involves risk and may result in a loss of principal. Investors should carefully consider their own circumstances before making any investment decision.