HJ Sims Steers Expansion Financing through the COVID-19 Storm to Closing
Voralto Living, along with its affiliates (“Voralto”), is a 42-year-old best in class senior living owner, operator, and developer whose leadership team has a combined 120+ years of experience in the senior living industry. Voralto’s Chairman and CEO, Carl Mittendorff, acquired the company in December 2016. Mr. Mittendorff has prepared the company for strategic growth by solidifying and strengthening its strong culture and by deploying updated software, systems, and tools, laying the foundation for innovation and scalability. HJ Sims’ relationship with Mr. Mittendorff dates back to his tenure as Chief Investment Officer at Watermark Retirement Communities. The Voralto leadership team consists of passionate and experienced senior living professionals, having deployed over $1 billion of equity into solely senior living assets, totaling over 36,000 beds across 100+ transactions, 36 states, and over $3 billion in value.
HJ Sims was approached by Voralto to provide an equity investment to fund the acquisition of a 60-unit assisted living and memory care community located in Northern Texas (the “Community”). Voralto’s business plan includes the implementation of several operational improvements at the Community to increase occupancy and drive profitability. HJ Sims’ investment in the project needed to be structured to allow Voralto time to implement and execute on its business plan. Additionally, the acquisition was initially scheduled to close in March 2020 and subsequently encountered a number of challenges and delays as a result of COVID-19.
Through an affiliate of Herbert J. Sims Investments, LLC (“HJSI”), HJ Sims joint ventured with Voralto to acquire the Community. HJ Sims structured its investment in the Joint Venture to meet the needs of its partner, while simultaneously meeting the requirements of its investors. Additionally, as a capital partner HJ Sims provided valuable support in (a) reviewing and negotiating loan documents, (b) working through timing issues as a result of COVID-19 and (c) navigating underwriting challenges and roadblocks as a result of the virus.
Closing a transaction in these unique times requires a flexible financing partner. HJ Sims created a customized financing solution meeting the investment needs of Voralto. HJ Sims successfully underwrote Voralto’s business plan, which included significant enhancements to the marketing and management team onsite. Through its Private Client Group, HJ Sims secured capital from its high net worth investors in a turbulent market to fulfill its investment, meeting the timing needs of the Community. HJ Sims worked with Voralto to develop a capital structure that provided ample liquidity and time for to implement the business plan and mitigate potential impacts from COVID-19.