A CCRC in Annapolis, Maryland with a securitized $17 million mortgage that did not allow a prepayment (current balance was down to $15 million) secured a bank refinance with the help of HJ Sims. The CCRC already had a history with HJ Sims, having received a $48 million construction loan and $8.4 million of development capital from them in 2001 and the $17 million mortgage in 2005. Because this mortgage was due on January 1, 2016, the CCRC had to defease the existing mortgage by escrowing all future principal and interest payments, thereby creating negative arbitrage. Plus, the CCRC had been servicing an outstanding subordinate loan from the original developers ($300,000 of which was outstanding) with excess cash, which hampered the community’s ability to build up its cash balances. So, HJ Sims arranged through a local bank a new $16.5 million mortgage with a 30-year amortization that refinanced the outstanding mortgage and developer loan, a $5 million draw-down facility for capital improvements and a $1 million working capital line of credit. The new taxable mortgage reduced the interest rate by over 100 basis points while fixing it for 10 years, and lowered annual debt service by $165,000. This refinancing package should give the community the flexibility it needs to stay competitive in the growing local market.