Lifespace (December 2023)

Sims Leads Financing to Refinance Bridge Loan and Fund Capital Expenditures

Partnered Right®

Established in 1976, Lifespace is one of the largest nonprofit owner/operators of life plan senior communities in the US, with 17 communities across seven states, serving more than 4,000 seniors. Presently, the Lifespace Obligated Group holds a “BBB” (Negative Outlook) rating from Fitch Ratings. This Lifespace financing represents the third completed with HJ Sims.

In early 2023, Sims assisted Lifespace in placing a bridge loan to facilitate the initial commitment payment made as part of the Edgemere bankruptcy. Recognizing the short-term nature of the bridge loan, it was structured with an interest rate escalation in December 2023 and a maturity in spring 2024. Furthermore, Lifespace wanted to take the opportunity to fund the completion of the continuum of care at one of their communities and enhance their cash position in anticipation of expected cash outflows.

Structured Right®

Confronted with the constraints imposed, particularly the increased interest rate and short-term maturity, by the bridge loan, Lifespace engaged Sims to refinance the loan and explore additional financing capacity. In refinancing the bridge loan with long-term debt, Sims was able to extend the final maturity significantly while also lowering the interest rate cost.

During the course of developing the financing plan, it was determined that the Series 2023B&C Bonds would also fund the second deposit to the Edgemere escrow, the buildout of the entire care continuum at one of Lifespace’s campuses, and various other capital expenditure reimbursements. Considering planned project reimbursements, state TEFRA approvals, and weighted average maturity tax considerations, careful structuring of the bond amortization was essential.

Executed Right®

Given the publicity surrounding the Edgemere bankruptcy, and the general volume of Lifespace debt, it was imperative that investors understood the long-term vision of Lifespace management. To assist in this effort, Sims aided Lifespace management in organizing multiple investor meetings nationwide in anticipation of the financing. Sims also played a crucial role in guiding the financing team through regulatory hurdles across the two issuers within a tight financing timeframe.

Financed Right®

Despite the ongoing turbulence in the fixed-rate bond market for senior living debt, on December 14, 2023, Sims successfully closed $111.74 million in tax-exempt fixed-rate bonds. This financing was comprised of $81.14 million in 2023B bonds issued via the Iowa Finance Authority, with a final maturity of 2052, and $29.60 million in 2023C bonds issued via the Palm Beach County Health Facilities Authority, with a final maturity of 2058. New investors made up 3 of the top 5 and 6 of the top 10 purchasers, representing collective par amounts of $30,200,000 and $49,700,000, respectively. Given the exposure constraints of current bond holders, these new investors represent additional potential lending capacity. In total, the financing replaced the rate-escalating short-term debt with fixed-rate long-term bonds at a lower interest rate while also financing projects that strengthened the overall profile of Lifespace. This financing also attracted a broader investor base, showcasing increased lending capacity for future capital requirements.

For more information, please contact:

Aaron Rulnick


Lynn Daly


Testimonials may not be representative of the experience of other clients. Past performance is no guarantee of future results