The $1.2 trillion Infrastructure Investment and Jobs act was signed into law on Monday by President Biden, who appointed former New Orleans Mayor Mitch Landrieu as his senior advisor responsible for coordinating its implementation.
Continue readingExactly as expected, the central bank announced plans to reduce its monthly bond purchases by $15 billion in November and December and, economic conditions permitting, continue to taper through June of 2022 when net new purchases of government and mortgage-backed bonds would cease.
Continue readingNovember is Long Term Care Awareness Month, and this year marks the 20th anniversary of the annual designation. As one of the top capital funding sources for continuing care retirement communities and other senior living facilities, HJ Sims understands that 70% of men and women over the age of 65 will have need for some type of long-term care in the coming years.
Continue readingJohann Sebastian Bach’s Toccata and Fugue in D minor is one of the most famous pieces of Baroque organ music ever written and its opening notes still send chills up the spines of Halloween party-goers. At this writing, however, no traders are humming these unforgettably eerie notes as we head into month-end and All Hallows’ Eve.
Continue readingThird quarter corporate earnings reporting season began in earnest last week and stock prices rose as investor alarm over rising inflation, supply disruptions, and waning consumer sentiment notched down a bit with strong bottom line results and positive forward guidance.
Continue readingIn the animal kingdom, owls have the highest degree of head rotation. We humans cannot attempt such flexible maneuvers, but as investors, as advisors, as managers, as parents and caregivers, we would sure love to have a 360-degree view of the world at all times, to be able to see whatever is coming from any direction so as to avoid trouble as well as pounce on opportunity.
Continue readingHere we are in the final quarter of the year trying to figure out what we may need to do to help and protect our portfolios, investment goals, families and businesses, between now and year-end. There is a big “Wall of Worry” and less than 60 trading days left, some of which could be very volatile.
Continue readingOver the past 18 months, we have all refashioned our lives, some several times, by choice or circumstances related to health or work or family. We created safe cocoons and, as a result of vaccines and COVID fatigue, burst out of them.
Continue readingOne psychologist theorized that there may have been a time during human evolution when there was no connection between the right and left chambers in the human brain, perhaps ancient people had a bicameral mind in which one side of the brain made command decisions and the other side listened and obeyed. Many of us are of two minds about the momentous decisions being made in Washington in the coming weeks.
Continue readingWith consumer confidence falling to a six-month low, many consumers are reducing spending and getting back to the basics. Economists are struggling to put the higher prices we are paying into context to rationalize inflation rates, the consumer price index and other spending metrics.
Continue readingIn the Cherokee creation myth, when plants and animals were first made, they were told to keep awake for seven nights. The plants who succeeded became evergreens, and all others were doomed to lose their “hair” every winter. The animals who stayed up were given the power to “see” in the dark. Investors trying to create or manage a portfolio in current market conditions either feel like their clear vision of the future will guide them while others feel like they are just dancing in the dark.
Continue readingIn the process of forward deliveries, we rely upon the close relationships that our veteran sales executives maintain with major buyers, enabling us to structure bonds with prevailing fixed rates for settlement or delivery at a future date.
Continue readingWe are literally mid-summer and whether we are in the middle of our vacation or our workweek, we are never more than a few minutes away from a device blasting the latest headlines from every corner of the globe and even news from outer space.
Continue readingWe are literally mid-summer and whether we are in the middle of our vacation or our workweek, we are never more than a few minutes away from a device blasting the latest headlines from every corner of the globe and even news from outer space.
Continue readingThe longest serving legislator in America, and the last World War II veteran to serve in a state legislature, resigned earlier this year after 64 years in public office. Those with decades of experience have much perspective to offer, favors to trade, bonds and relationships to rely upon, and powers to exercise and may make for a worthy debate on the subject of tenure and term limits.
Continue readingA number of poisons and toxins found on earth or synthetically derived, when administered in a certain dose, cause swift and deadly harm. Financial analysts have been assessing the scale of Washington’s response to the toxic impacts of COVID-19 on the economy.
Continue readingA number of poisons and toxins found on earth or synthetically derived, when administered in a certain dose, cause swift and deadly harm. Financial analysts have been assessing the scale of Washington’s response to the toxic impacts of COVID-19 on the economy.
Continue readingby Gayl Mileszko
We are each born with approximately 270 bones that provide the structure for our bodies. By the time we reach age 21, however, some bones have fused together and the total count falls to about 206. Fifty-four of these bones are in our hand and wrist, twenty-six in each foot, ten in the shoulder and arm. Like other tissues, these bones are all alive. They are comprised of collagen, calcium phosphate, sodium and other minerals, make up 15 percent of our body weight, and come in long, short, flat and irregular shapes. Without us realizing it, each and every one is rebuilt from scratch every ten years. The stapes bone, located in the middle ear, is the smallest and lightest. The femur or thigh bone is the largest. The clavicle or collar bone is the weakest, and the most commonly broken. The sharpest point on the human body is the hinged joint made up of the humerus, ulna, and radius bones, commonly known as the elbow.
Elbows can be devastating weapons. In some martial art styles, they are used in powerful, close-range strikes, typically targeting areas of the skull to knock out an opponent or deliver vicious cuts. In most contact sports, however, their use is prohibited. In ice hockey elbowing results in a two-minute penalty. In basketball, “throwin’ ‘bows” counts as an intentional foul. In the arena of Washington, D.C., elbow bumps became the new and safer form of backslapping when coronavirus first began to spread. Sharp-elbowed politicians, the opposite of legislative pushovers and compromisers, nevertheless abound. On Wall Street, well-heeled titans are often described as having elbowed their way to the top.
Since the Great Recession, Main Street, Wall Street, Capitol Hill and the White House have given the Federal Reserve an unprecedented amount of elbow room. But even back in 2008, no one could have imagined how far the Fed would go to intervene in the financial markets these past 16 months. For our own good, the Fed and its European and Asian counterparts have quashed free markets for the foreseeable future. For the good of the country, if not the world, the long-term, multi trillion-dollar U.S. bond buying program is placing a heavy, Fed-sealed lid on interest rates. In Europe, central banks have negative rates prevailing in 9 countries. When inflation is factored in, all sovereign rates – including ours – are negative. In what was once normal times, the Fed would raise interest rates to slow the economy and bring inflation down. That is not happening in the new normal, where crushing many family budgets but the mission of the Fed to Federal Reserve typically raises interest rates to slow the economy and bring inflation down.
The Fed reports to Congress regularly and the Chair meets with the President on request, at least twice in the last month. So, there is no doubt that the Fed is not independent in its thinking that rates need to remain artificially low for as far as the eye can see. No one needs to give Fed officials the elbow about the need to keep rates suppressed, regardless of how high or for how long prices increase. (Consumer prices rose 5.4% year over year in June, the biggest monthly jump in 13 years.) But in direct contradiction to all the textbook market reactions to soaring inflation numbers, Treasury yields have fallen by nearly 15%. The singular power of the Fed continues to suppress all the highly unsettling inflation signs. We are told that inflation is transitory and we apparently accept this as gospel even when faced with a record U.S. indicator on top of a national debt exceeding $28.54 trillion, and interest on the debt well over $378 billion a year and rising. The federal budget deficit looks like it will easily exceed $3 trillion this year and could quickly double if a new infrastructure reconciliation package is enacted without offsets.
Investors who lean on the Fed without elbow pads demonstrate a lot less confidence in other public agencies, their data, and pronouncements. Serious new concerns about the Delta variant and the smothering effect which it threatens to have on the U.S. and global economic recovery have led to several market duck-and-runs of late. At this writing, since the start of the month, the VIX has jumped 42%, the Dow has lost 540 points, the S&P 500 is down 39, the Nasdaq is off 229 points, and Bitcoin has fallen 10 percent. Gold us up 2% and, for reasons including the new OPEC+ agreement, oil prices are down nearly 10 percent. U.S. Treasuries have been the biggest beneficiary, and moves in this key market are driving trades in just about every other asset class. While most analysts had expected 10-year Treasury yields to have risen to about 2% by this point in the COVID economic recovery, both the 10- and 30-year yields have fallen 28 basis points across the curve this month alone to stand at 1.18% and 1.81% respectively. Municipals have also made some serious gains across flattening yield curves as the 10- and 30-year benchmarks have fallen 18 basis points in July to 0.81% and 1.32%, respectively. Baa corporate bond yields in ten years are down 16 basis points to 2.85%.
Pasta elbows which originated in Northern and Central Italy pair well with almost every type of sauce, soup, salad, and stir fry in the same way that municipal bonds meet the needs of those looking for tax-exempt investments, compounding principal and interest, taxable alternatives to corporate and mortgage-based securities, higher yielding fixed income instruments with some of the highest year-to-date returns so far, and/or risk levels on an international scale that generally rank just below those if U.S. Treasuries. More than halfway through the month, tax-exempts are on a path to gains not seen in any other July since 1990. For investors, however, trying to find yield is harder than trying to scratch your ear with your elbow. Last week, the $5 billion calendar included deals coming with below investment grade ratings in 40 years at yields under 3.00%, such as the $68.3 million California student housing deal for BB rated Sonoma County Junior College that came at 2.90%. Among non-rated deals, the Florida Development Finance Corporation brought $113.4 million of bonds for Renaissance Charter School structured with a 2051 maturity priced at par to yield 5.50%, the Public Finance Authority (PFA) sold $41 million of BB+ rated hospital revenue bonds for Carson Valley Medical Center with a 30-year term priced at 4.00% to yield 2.33%, CARTI Surgery Center came with a $40 million deal through the Arkansas Development Finance Authority with 2052 term bonds priced at 4.00% to yield 3.40%, and the St. Paul Housing and Redevelopment Authority sold a $13.7 million charter school financing for Minnesota Math and Science Academy that included 2056 term bonds priced at 4.00% to yield 3.80%.
Bones provide the structure for our bodies in much the same way as muni bonds provide critical infrastructure for our country. This week, investors will see a little bit of every kind of financing for essential projects ranging from water and sewer, to airport, college, hospital, multifamily housing, transit, and elementary and secondary schools. Muni investors will see more than $10 billion of supply, but Bloomberg notes that this will fall short of current demand by at least $12.3 billion. The high yield calendar includes three charter and private school financings: the Build NYC Corporation has a $65.5 million non-rated issue for Shefa School, the PFA is bringing a $6.3 million non-rated deal for the Capitol Encore Academy, and Universal Academy in Michigan plans a $9.7 million BBB-minus refunding. We expect most deals to be priced at high premiums and to be well oversubscribed by the largest municipal bond funds and Exchange Traded Funds. They have taken in $63.4 billion of net assets this year so far, bringing total net assets over $1 trillion for the first time. For borrowers looking to access this incredible market, and for investors looking to maximize yield within their risk parameters, we encourage you to contact your HJ representative. We work for you using proprietary analytics, generous applications of common sense, and lots and lots of elbow grease.
Please contact your HJ Sims representative for information about today’s higher yielding taxable and tax-exempt offerings.
by Gayl Mileszko
Champions World Resort, a 435-key hotel and conference center in Kissimmee, Florida is undergoing a $14 million redevelopment and will soon re-emerge as a 352 micro studio and one-bedroom market-rate apartment complex intended as affordable workforce housing for employees of Disney and other area resorts. It is one of many hotel-to-housing conversions taking hold in the United States in the wake of the pandemic. The severe stress experienced by hotel operators in 2020 and growing interest in addressing various housing shortages are driving projects such as one in Colorado Springs, where a developer has proposed to turn the city’s second largest hotel, the Hotel Elegante Conference and Event Center, into 642 “attainable” apartments. Real estate owners with distressed assets are finding a number of interested for-profit and non-profit buyers looking to reposition their properties. Repurposing projects involving hotels with in-unit kitchenettes and bathrooms involve behavioral health, multifamily, student and senior housing. An April Jones Lang LaSalle study on hotel conversion activity suggests that the total market value of hotels sold for conversion over the next five years will range between $25 billion and $30 billion.
Manchester, Connecticut is just one city that is amending its zooming regulations to allow hotels and motels to be converted to multifamily units. The 22-year old extended stay Homewood Suites by Hilton in Charlotte is planned for conversion into a market rate multifamily community. In Baltimore, an investor group just purchased the Embassy Suites Inner Harbor and plans to convert the 37-story hotel into apartment units. California is using federal stimulus funds for the new Homekey program which has purchased 94 extended stay hotels and motels to convert into permanent housing for the homeless. In New York, the 122-year-old Park 79 Hotel is being transformed into 77 units of affordable housing for seniors. A National Association of Realtors (NAR) survey of commercial brokers conducted between February and March of this year documented 187 hotel or motel conversions in progress, 57% of which were for multifamily housing, 11.7% for temporary or permanent homeless shelters, 11% for senior housing, 7.5% for student housing, and 6.4% for hospital or COVID quarantine facilities.
Hotels were among the first to see demand drop after the pandemic was declared and lockdowns took effect, but they have been among the first sectors to see demand come back. Average occupancy plummeted to 36.7% in 2020 according to the American Hotel and Lodging Association (AHLA) and the average daily room rate dropped 30% to $92. The NAR reported that midscale, extended stay and short term rental hosts like Airbnb were less impacted than luxury and upscale hotels reliant on business and group travel. But in most markets, hotel occupancy remains well below 2019 levels. The AHLA recently studied 21 of the top 25 hotel markets, categorizing the overall U.S. industry as in a recession and urban hotels as in a depression. As a result of the dramatic drop in business and group travel, primarily in urban areas, revenues are not expected to recover fully until 2023 or 2024; in the case of New York City, a rebound is not expected until 2025. May 2021 revenue per available room (RevPar) fell 22% from 2019 levels; in urban areas RevPar was down 52%. The hardest hit area is San Francisco, which was down 70%, just below Boston, Washington D.C., New York and Chicago. Among the properties that have closed for good are the Marriott Wardman Park in Washington, D.C., the W New York Downtown, the Standard West Hollywood, and Luxe Rodeo Drive. But hotels in Tampa and Miami are another story altogether; these two markets began outperforming in terms of either 2019 occupancy or RevPar in May, and state and local hotel occupancy tax collections are up.
In the municipal bond market, Bloomberg reports that $23.5 billion of hotel tax-backed bonds are outstanding. Strong fiscal management, surplus cash, well-funded reserves and some refinancings have kept nearly all of these projects financed by municipal bonds current on debt service. Many operators and employees received a lifeline from federal stimulus; the accommodation and food services industry received more than $80.3 billion in Paycheck Protection Plan loans in 2020 and 2021. Some municipalities have even gone forward with plans for new hotel projects during the pandemic. Last December, the Virginia Small Business Authority issued $6.5 million of non-rated bonds to assist in the development of the Embassy Suites Oceanfront in Virginia Beach, secured by portions of state sales and use taxes and guest access fees. This past March, the Georgia World Congress Center Authority $439 million of bonds to construct a new upscale convention center hotel with 975 rooms adjacent to the Mercedes-Benz stadium in Atlanta to be operated under the Signia by Hilton brand. Bonds are secured by gross operating revenue generated from the hotel on deposit in a lockbox fund. A similar lockbox feature, however, secures $195 million of the bonds issued for the Hilton Austin Convention Center in 2017 that are now distressed. The hotel, which opened in 2003, had an average occupancy of 22.7% last year and the total net position of the owner and operator decreased by $19.2 million as compared to a net position increase of $12.2 million for the year ended December 31, 2019. Revenues have been insufficient to pay debt service, so there have been draws on six Trustee-held funds to make the last three interest payments; bonds were downgraded to below investment grade in March.
In a municipal market with more than $3.9 trillion of par outstanding, Bloomberg reports a total of only 55 distressed and defaulted bond financings with combined outstanding par of $2.45 billion. 51% of these projects have had covenant defaults including taps of the debt service reserve funds while only 27 projects have had actual debt service payment defaults, including the January 1 principal and interest on a Middlesex County, New Jersey bond issued in 2005 for The Heldrich Hotel and Conference Center in New Brunswick. The majority of these deals were troubled before the pandemic struck. But the vast majority of muni bonds are paying timely principal and interest, a true testament to the fundamental strength and resiliency of the municipal market, the rapid and unprecedented federal and state stimulus, the talent and adaptability of project managers, and the essential nature of the publicly financed projects. Given the sudden and severe adversity, the length and magnitude of the shutdowns, and the continuing impacts on municipal sectors including mass transit, senior living, student housing, and parking systems, performance is indeed impressive. Granted, the pandemic is by no means over and financial stress persists on general obligation as well as revenue bond issuers. But Moody’s just reported that none of the bonds it rates had a virus-related default last year; the average municipal default rate between 1970 and 2020 was reported at 0.08%.
Higher prices for everything from drywall and steel to beef and gasoline place a new layer of financial stress on businesses, governments and nonprofits still struggling in the economic recovery. Last month, inflation ran at the fastest pace in nearly 13 years. The Consumer Price Index just made its largest jump since August 2008 to 5.4%, well above expectations from economists. Core CPI, a measure that excludes the prices of food and energy prices most relevant to Main Street, was up 4.5%, a jump not seen since 1991. Higher prices continue to prevail in the stock market, where major indices are up between 1.4% and 2% since June 30. At this writing, the Dow is up 493 points on the month to 34,996. The S&P 500 is up 86 points to 4,383. The Nasdaq is up 229 points to 14,733. Oil prices at $74.10 have gained 63 cents a barrel, gold at $1,805 is up $33 an ounce, and silver at $26.15 has gained 11 cents. Just about the only sector down so far in July is Bitcoin, off 3 percent at 33,149. Bond prices also continue to escalate in astonishing contrast to almost every prediction made since the start of the year, indeed since 1981 when the 10-year Treasury yield stood at 15.84%. The 10-year yield at this writing is 1.36%, down 10 basis points on the month. The 2-year Treasury has fallen 2 basis points to 0.22%, and the 30-year yield is now below 2%, down 9 basis points in July.
Last year, borrowers in the global corporate market came in droves to raise as much cash as possible at record low rates for their COVID war chests. Cash holdings increased to an all-time high of $5.2 trillion as companies positioned to sustain themselves through the recession, grab more liquidity than the competition, and forestall any future impediments to market access. Dealogic reported that nonfinancial companies issued $1.7 trillion of bonds in the U.S. last year, nearly $600 billion more than the previous high. By the end of March, their total debt stood at $11.2 trillion, according to the Federal Reserve, roughly half the size of the U.S. economy. The Securities Industry and Financial Markets Association reports that the U.S. Treasury raised $4.28 trillion of net cash last year and the Municipal Securities Rulemaking Board reports $516.9 billion of new issuance in 2020. Year-to-date in 2021, new muni issuance exceeds $238 billion. High yield munis have returned 5.8%, while investment grades are up about 2%. So far this month, the 2-year muni AAA general obligation yield at 0.12% is down 4 basis points, the 10-year at 0.84% is down 15 basis points, and the 30-year benchmark at 1.33% is down 17 basis points. These levels remain extraordinarily attractive to borrowers but for a variety of reasons many have not yet come to market. In the meantime, buyer demand has been insatiable in an environment where talk of higher taxes and signs of low volume in both the primary and secondary prevail. Customers have been adding to muni bond mutual fund holdings for 18 consecutive weeks. Net inflows to bond funds total $51.3 billion this year; inflows to muni ETFs total $12.08 billion. Buyers consistently outnumber sellers: CreditSights reports that the last day of net customer muni sales was on December 22. Unfortunately, there is still not much being offered to these buyers, both institutional and retail. The amount of negative net supply is estimated at $12.3 billion for July. There are $12 billion of coupon payments on top of $41.5 billion of redemptions and called bonds expected this month while the 30-day visible supply totals a mere $13.7 billion.
So far this month, we have seen only a small number of high yield deals. The Massachusetts Development Finance Agency sold $56.7 million of non-rated revenue bonds for Ascentria Care Alliance structured with 2056 term bonds priced with a coupon of 5.00% to yield 4.04%, and the National Finance Authority sold $28.8 million of non-rated companion bonds with a 2056 maturity priced at the same level. The City of Manhattan, Kansas issued $44.8 million of BB+ rated health care facility revenue bonds for Meadowlark Hills that had a 2046 maturity priced at 2.75% to yield 2.82%. The Arkansas Development Authority brought $21.9 million non-rated charter school revenue bonds for Responsive Education Solutions that included a 2052 term bond priced with a 3.625% coupon to yield 3.92%. This week’s $10 billion calendar includes a $68.4 million BB rated California student housing bond issue for Sonoma County Junior College, a $40 million non-rated Arkansas deal for Carti Surgery Center, a $40.8 million BB+ refunding through the Public Finance Authority for Carson Valley Medical Center in Gardnerville, Nevada, a $14 million non-rated PFA deal for Ripple Ranch Recovery Center in Spring Branch, Texas, and a $150 million Ba1 rated deal for the Catholic Bishops of Chicago. Bonds come to market in the context of economic data releases including CPI, producer prices, and retail sales; data showing the resurgence of COVID-19 in many regions; the Federal Reserve Chair’s appearance before House and Senate Committees delivering the semi-annual Monetary Policy Report; the first second quarter corporate earnings of the season; an ongoing OPEC+ deadlock on production policy; and high yield corporate bond yields that hit an all-time low of 3.53% last week.
Please contact your HJ Sims representative for information about today’s higher yielding taxable and tax-exempt offerings.
by Gayl Mileszko
Almost twenty years after the 9/11 terrorist attacks that we promised to “Never Forget” we now have a prolonged pandemic that is still creating indelible memories. Many of us can still name each family member, friend, and colleague affected two decades ago. But today we can recount even more precious people and businesses lost or devastated due to COVID-19. In the financial world, we are keenly aware of the specific sectors of the stock and bond markets that were unexpectedly pummeled in March of 2020; some are thriving, others bankrupt, quite a few rescued with our tax dollars, many still crawling back. In the immediate aftermath of the World Health Organization and presidential declarations, bonds that financed food service companies, cruise lines, airports, hotels, convention centers, sports arenas, hospitals, toll roads, malls, oil and gas and mining companies, all sank in price as lockdowns directly halted revenue streams supporting debt service while causing operating expenses to surge.
We still do not know the lifecycle of this virus or its variants but, 15-plus months later, Moody’s and CNN report that the nation’s “Back-to-Normal Index” is at 94%. Summer vacation exuberance may be skewing our perspective, but we will have a much better grip on where things are for work, home and school once September arrives. For now, bond traders report that spreads, the difference in yields when compared to the highest rated credits, have more than completely recovered in most A and BBB range debt while higher yielding securities are also about 94% back to pre-COVID levels. Some sectors like education, hospitals, transportation, turnpikes and toll roads, and single- and multi-family housing still have a little way to go. But the strength of the recovery, and our new perceptions of essentiality, have generally boosted the value of water and sewer, power, utility, airports, and healthcare bonds.
In the municipal sector, most analysts agree that senior living has been hardest hit. Life plan communities, retirement communities, independent living, assisted living, memory care and skilled nursing serve the demographic that has suffered most and facility operators have been at the forefront in the unforgettable fight against the pandemic. Since the onset, top-notch managers have employed every available expert, dedicated staffer, piece of equipment, technology, strategy, tactic, agency, grant, loan, and line-of-credit to keep residents safe. Most caregivers have literally worked around the clock to protect residents who by virtue of age and condition have been most vulnerable to community spread. As a result, fifty one percent of seniors housing properties studied by the National Opinion Research Center (NORC) at the University of Chicago experienced no COVID-19 deaths in 2020. About two-thirds of independent living (67 percent); assisted living (64 percent); and memory care (61 percent) properties had no COVID-19-related deaths, and 39 percent of skilled nursing facilities experienced no related fatalities. Nevertheless, the AARP has reported that more than 184,000 residents and staff of nursing homes and other long-term care facilities have perished as a result of COVID. The share of COVID-19 deaths attributed to long term care facilities reportedly peaked in June 2020, when almost 49% of deaths occurred there. But vaccinations first made available in December 2020 have caused dramatic declines in all the counts. The CDC reports that the rate of deaths per 1,000 residents in nursing homes has dropped from the high of 5.9 in December 2020 to 0.29 as of June 2021, and staff cases have declined from 26.38 to 0.41.
The latest surveys by the National Investment Center for Seniors Housing and Care (NIC) from June 13 show that, although seniors housing and care occupancy rates remain at historic lows, trends in the percentages of organizations reporting higher occupancy rates continue to improve; assisted living, memory care and skilled nursing are showing new pandemic era highs. Since March, there has been a rising pace of move-ins. The greatest challenge for 94% of these facilities is said to be staff shortages, a problem that affects employers across most industries; they recently posted a record 9.3 million job openings. But the need is particularly acute for certified nurse aides where open positions exceed 200,000.
HJ Sims underwrote the first municipal bond to finance a long-term care community in 1965 after closely analyzing demographic data and demand projections, and we remain among the biggest supporters of senior living. We have since introduced several innovative structures including entrance fee principal redemption bonds, and have underwritten or advised on more than $27 billion of financings in this space. Including the deals we brought to market, there were only about 63 senior living deals with a combined par value exceeding $3.25 billion in the muni market in 2020. So far this year, we have seen 35 deals totaling $1.73 billion. But the number of new and refunding issues is growing by leaps and bounds as investors recognize the demand for and value inherent in the sector.
This week, we are in the market with a $79 million non-rated financing for Benedictine Health System, the tenth largest not for profit senior living provider in the country which owns and operates 21 communities in Minnesota add North Dakota. This transaction is part of a $7 billion new issue calendar that includes seven senior living deals, an array of weekly offerings in this sector that has not been seen for many years. We expect that the $390 million of new money and refunding issues will be several times oversubscribed by institutional and individual investors, a clear sign that tax-exempt buyers highly value this essential public service sector. Featured borrowers cross the credit spectrum and include non-rated Friendship Village in Kalamazoo, Michigan; nonrated Colorado-based Christian Living Communities; BB+ rated Meadowlark Hills in Manhattan Kansas; BBB rated BHI Senior Living of Indiana; non-rated Ascentria Care Alliance in New England; and BBB rated Westminster in Austin which, at this writing just sold with a final maturity in 2055 priced at 4.00% to yield 2.31%.
At this writing, the AAA general obligation benchmarks post yields of 0.16% for the 2-year maturity. 1.01% for the 10-year and 1.52% for the 30-year. This compares with Treasury yield curve reflecting yields ranging from 0.25% for the 2-year, 1.47% for the 10-year and 2.08% for the long bond. The 10-year Baa rated corporate bond yield stands at 3.05%. On the month, the Dow at 34,292 is down 237 points while the S&P is up 2% to 4,291and the Nasdaq is up nearly 6% to 14,528. Oil prices are up nearly 11% in June while gold and silver prices have fallen more than 7%.
HJ Sims representatives stand ready to assist both borrowers and investors in the senior living space. We are active in the primary as well as secondary markets and our senior bankers and financial professionals welcome your call. We are in a market that continues to be defined by heavy demand, low rates, and high relative credit quality. It continues to favor the issuer, but we are also here relentlessly working for our clients, helping you to define and execute on your income investment strategies. This week, we move into the second half of the year, so it is time to review your goals and needs. Give us a call after the holiday weekend. We note that markets close early on Friday and remain closed on Monday in observance of our nation’s 245th Independence Day. The entire HJ Sims family wishes you a safe, happy, and unforgettable Fourth.
Please contact your HJ Sims representative for information about today’s higher yielding taxable and tax-exempt offerings.