Sims Assists Client in Campus Repositioning with a 15 Year Financing at 3.02%
Partnered Right®
The Jewish Home of Rochester is a New York not-for-profit corporation which has been in operation for over 95 years. In addition to providing long term nursing care, the Home operates a short term rehabilitation unit and has numerous community based service programs such as an Adult Day Health Care program, outpatient rehabilitation program as well as a physician House Calls program.
Structured Right®
The Jewish Home of Rochester developed the new project based both on its experience in delivering a broad range of services to seniors in the Rochester market and on long term care industry best practices. The Jewish Home has adopted a “person centered care” philosophy which, in the view of the board and management, is best provided in Green House homes. This ambitious plan centered on the construction of 9 Green House homes located in three, three-story buildings on the existing campus for a total of 108 skilled nursing beds. Additionally, moving to all private rooms in the existing facility will improve resident privacy and thus further foster this specialized care approach.
HJ Sims worked with The Jewish Home of Rochester management throughout the development and planning stages of the process to determine the scope and viability of the new project. After final determination of the project scope, HJ Sims analyzed the most appropriate financing structure and, after taking into account many factors such as debt capacity, strength of financial ratios and interest rates, recommended the direct placement of tax exempt bonds with one or more banks. The total cost of the repositioning is $82.8 million with $27 million coming from a contribution from the Jewish Senior Life Foundation and existing cash reserves.
Executed Right®
HJ Sims facilitated a Request for Proposals process and solicited proposals from more than fifteen banks. Due to its strong reputation in the Rochester area, there was significant interest from numerous banks in participating in the financing. Ultimately, one bank committed to the entire financing for a 15 year term. The tax-exempt financing process and execution of the transaction were coordinated by HJ Sims with the assistance of the financing team
Financed Right®
On October 12, 2016, The Jewish Home of Rochester completed a $55.8 million direct placement of tax exempt bonds for the 2016 project. To protect against rising interest rates, an interest rate cap was purchased through the construction period with a forward starting interest rate swap to commence after construction is completed in 2019. The interest rate swap is for a 30-year term, although cancellable at any time after 15 years at no cost or penalty. The average interest rate on the 15-year financing was 3.02%.
For more information on how The Jewish Home of Rochester was Financed Right® by HJ Sims, please contact:
Andrew Nesi
(203) 418-9057