A couple of years after purchasing two Rhode Island skilled nursing facilities, Athena Health Care Systems has gone to HUD to refinance the two properties, with the help of HJ Sims. Totaling 280 beds, the skilled nursing facilities combined for an occupancy in the mid-90s. This was not the first time Sims had gotten involved with these facilities. In fact, when Athena acquired them in 2013 and 2014, Sims issued both conventional bank financing and preferred equity to fund the deal. But, the bank debt was scheduled to mature in 2020 and 2021, respectively, and Athena chose to refinance through HUD to take advantage of the current low interest rate environment. So, Sims Mortgage Funding underwrote two HUD loans which were included in the master lease structure that Sims originally arranged for two other HUD-insured, Athena-owned properties in Rhode Island in 2014. Closing simultaneously, the 35-year loans came in at loans-to-value of 74% and 77%, respectively, as well as debt service coverage ratios of 3.16 and 2.92, respectively. And the interest rates were below 3.25%. These are the seventh and eighth properties that Athena has refinanced through HUD with the help of Sims Mortgage Funding. Something is clearly working.
