HJ Sims Successfully Completes $19.7 Million Independent Living Expansion
Project with 12-Year Bank Commitment
$19,700,000 | PENNSYLVANIA | APRIL 2026
“Jim Bodine and David Saustad did an excellent job coordinating the financing for the first phase of our Fellowship Community independent living expansion project. Their expert guidance and support made a complex process seamless. They successfully navigated a multi-disciplinary bank
financing team, enabling our strategic growth plan to move forward without delay. We have worked with the HJ Sims team in the past and would certainly do so again as future phases of our expansion roll out. We highly recommend their services to others.”
-Mary Kay McMahon, President and CEO
Partnered Right®
Fellowship Community (“Fellowship” or the “Community”) is a not-for-profit (Type C) life plan community, located on 65 acres in Whitehall, Pennsylvania. With a legacy dating back to 1905, originally as a home for widows and orphans, Fellowship has been serving seniors at its present location for over 35 years. The Community offers residential and full continuum of care services in a campus-based setting with a current complement of 151 ILUs, 94 PCUs and 121 SNF beds. It has an excellent track record of operation, including strong occupancy and operating performance and resulting financial performance and position.
Following the successful completion of a $25 million refinancing in 2021, HJ Sims was engaged again in 2025 to provide financing for an anticipated multi-phase independent living expansion project.
Structured Right®
Fellowship has achieved consistently strong occupancy across its residential and care continuum, including independent living with occupancy consistently exceeding 95%. It had last expanded independent living in 2013 with the addition of 34 Independent Living Units (combination of Townhomes and Apartments) together with 35 Personal Care Units. Based on this historic occupancy and continuing demand for additional independent living, Fellowship decided to undertake a phased independent living expansion, commencing
with an initial phase of 24 apartments (the “Suites”) comprised of two bedrooms (with and without dens) together with future plans for an additional 48 units and commons
center.
HJ Sims assisted Fellowship during the project planning process, including validating debt and project capacity and the phasing approach. Further, Sims worked with Fellowship to evaluate financing options, focused on bank financing, considering multiple factors. These included: i) the estimated $19 million project cost (and just under $20 million of total financing), ii) the benefit of drawing financing, as construction proceeded, rather than all at closing, iii) the anticipated availability of initial entrance fees to repay a portion of the debt following project completion and resident move in and iv) favorable albeit volatile interest rates. Considering these factors, along with Fellowship’s moderate debt load overall and continuing strong bank appetite for expansion project financing, Fellowship elected to undertake commercial bank financing which was expected to offer an attractive all-in interest cost and reduced borrowing requirements.
Executed Right®
Given Fellowship’s existing relationship with Truist, rather than undertaking a multi-bank solicitation, Fellowship elected to have HJ Sims solicit a proposal from Truist, and, assuming validation of competitive terms, enter into additional financing with Truist.
Financing objectives included:
1. Implementing a combination of construction financing together with permanent financing in a single transaction,
2. Securing committed financing for as long an initial term (tenor) as possible to minimize financing renewal and interest rate reset risk
and
3. Maintaining a common financing security structure and unified financing covenants, with Fellowship’s outstanding debt, to
provide it with continuing operating, financial and strategic flexibility.
Truist provided a strong proposal incorporating competitive interest rates, conditions precedent to closing aligning with Fellowship’s credit profile and the specifics of the project, continuation of objective-based covenant requirements and willingness to provide 12-years of committed funding. Following execution of the financing term sheet, HJ Sims collaborated with Fellowship, Truist and the financing working group, including respective legal counsel, to prepare the financing for closing. This included preparing financing legal documentation, finalizing the financing composition and monitoring completion of conditions precedent including final municipal approvals for the project and achievement of required pre-sales.
Regarding financing structuring, is common for draw-down bank construction financing, Fellowship elected to combine the floating rate feature during the construction/ draw-down period with a fixed interest rate on the permanent portion of the debt, following project completion and fill-up. The fixed rate on the permanent debt was achieved via a forward starting floating-to-fixed interest rate swap, with Sims collaborating with Marathon Capital Strategies, as swap advisor.
Financed Right®
The financing closed in March 2025 as a $19.7 million tax-exempt direct bank placement with Truist. It was comprised of $7.9 million of entrance fee redemption debt (to be repaid with a portion of anticipated first-generation entrance fees) and $11.8 million of permanent financing. As noted above, Fellowship undertook a forward starting interest rate swap on the permanent debt and locked-in an attractive rate of 4.42% for the 12-year tenor/term.
For more information, please contact:
James Bodine
267.360.6245
David Saustad
240.207.1202