Sims Successfully Completes Tax-Exempt Financing
Enabling Affiliation Integration and Funding
Continuing Campus Growth
$23,000,000 | Telford, PA | May 2025
“Grace Inspired Living’s family of communities wanted to create an obligated group concurrently with refinancing old debt and securing new debt. HJ Sims was right there to help us navigate the bank solicitations and the tax-exempt bond process. During this time of market volatility, Sims helped us refinance $7M of existing debt with an interest rate savings of over 100 basis points, plus secure $16M of new debt. They also guided us through a Swap hedge. We can now comfortably improve our
communities’ existing facilities and create new independent living inventory. Throughout the years, Jim Bodine and David Saustad have been a valuable resource. I couldn’t ask for a better financial partner than the HJ Sims team.”
-Dianna McGoldrick,
Vice President of Finance and CF
Partnered Right®
Grace Inspired Living (“GIL”) is a not-for-profit senior living organization that operates two life plan communities in Telford and Rockhill, Pennsylvania (suburban Philadelphia). The Lutheran Community at Telford (“Telford”) consists of 308 independent living units, 61 personal care units, 24 memory care beds, and 75 skilled nursing beds. The Community at Rockhill (“Rockhill”) consists of 198 independent living units, 53 personal care units, and 90 skilled nursing beds. GIL also operates an affordable housing community, Sellersville Senior Residences, in Pennsylvania. HJ Sims was engaged by GIL in 2024 to assist with refinancing of a portion of Rockhill’s outstanding bank debt (Series 2017-1 Bonds), as well as to fund capital improvements on both campuses.
HJ Sims, represented by Jim Bodine, had worked previously with GIL, completing a direct bank financing in 2017 for the Telford community. This consisted of the modification and refinancing of Telford’s outstanding bank debt combined with new capital financing. Additionally, HJ Sims also provided guidance related to GIL’s affiliation with the Rockhill community, which was finalized in 2017.
Structured Right®
Prior to the 2025 financing, GIL’s Telford and Rockhill communities were financed and secured as two, separate obligated entities, with Telford being the sole member of an obligated group and Rockhill as a separate, single entity. The Telford campus secured two series of bank debt, held by two different banks. The
Rockhill campus secured two series of bank debt, both held by the same bank. GIL sought to simplify its financing structure and combine the credit of its two
entities via addition of Rockhill to the existing Telford obligated group. However, due to a preference for continuation of separately-secured financing, the
Rockhill lender would not agree to be secured by the combined Telford-Rockhill credit in the expanded Telford obligated group.
Composition of the Rockhill debt consisted of one of the series of debt that matured in 2025, while the other series had an interest rate reset occurring in January 2025. Accordingly, to allow for Rockhill’s addition to the Telford obligated group, GIL decided to pay-off the debt that matured in 2025 (approximately $2.5 million) with cash, and to refinance the other series of debt (approximately $7.1 million) with a portion of the proceeds of the
2025 financing.
In addition to the refinancing, GIL was working on several capital improvement projects at both campuses that they sought to fund with debt: a new clubhouse and an expanded dining venue at the Telford campus, as well as HVAC work and the construction of a wellness center and other amenities at the Rockhill campus. In total, these projects were projected to cost approximately $15.5 million. In combination with the refinancing, the total borrowing was set at $23 million.
Based on the size of the borrowing and anticipated strong interest both from the Telford community’s existing lenders as well as other banks, GIL decided to solicit bank proposals for the financing.
Executed Right®
HJ Sims conducted a broad bank solicitation, canvassing more than twenty banks identified as having potential interest in providing financing to
GIL. This generated eleven financing proposals with favorable terms including attractive interest rate pricing, low up-front fees, measured conditions
precedent to financing and attractive covenants, consistent with GIL’s existing Master Trust Indenture for the Telford community. HJ Sims organized the
review of proposals and negotiations with interested parties which culminated in GIL’s selection of Truist Bank, one of the Telford community’s existing lenders. Attributes of Truist’s proposal included a low cost of capital, including provision of a synthetic fixed rate via interest rate swap, a long tenor (put date) that would limit loan renewal risk, and substantial conformance to the existing MTI (and those in the other outstanding Telford bank debt).
Regarding the use of floating vs. fixed rates, GIL elected to fix the interest rate on the debt via a floating-to-fixed interest rate swap. HJ Sims collaborated with Marathon Capital Advisors, as swap advisor, to review several hedging options – these included hedging a portion, rather than all, of the loan and an accreting swap for the new capital portion of financing that would be based on the anticipated draw schedule. GIL ultimately decided to fully hedge the
loans and use an accreting swap for this portion of financing to limit short-term interest rate risk during the draw-down period.
Financed Right®
In sum, with HJ Sims’ leadership and the collaboration of Truist and Marathon Capital Advisors, GIL successfully secured $23 million of total financing,
with an all-in rate of 4.16% for the Series 2025A refinancing portion and 4.22% for the Series 2025B new capital portion, a 10-year credit commitment
and continuing flexible financing security/covenant package that positions it for future growth and capital access.
Jim Bodine
267.360.6245
David Saustad
240.207.1202
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