Sinai Residences of Boca Raton, a 366-bed/unit CCRC in southeast Florida managed by Life Care Services, obtained a large bond financing to fund an independent living expansion that will grow its IL offering by nearly 50%. Just four years ago, the community opened with 234 independent living units, 48 assisted living units, 24 memory care units and a 60-bed skilled nursing facility, all at a cost of $265 million, or nearly $725,000 per unit/bed.
Upon the ribbon cutting, all of the IL residences were already sold, and about $90 million of entrance fee principal redemption bonds helped fund the project in addition to another $124 million fixed-rate bond financing, both arranged by HJ Sims. About $76 million were sold to retail investors with the balance being sold to institutional investors. Stabilization was quickly achieved across the property less than a year after opening.
HJ Sims was called upon again to secure the financing for the IL expansion, which will feature 111 new units. Life Care Services and the Sinai Residence Board commenced pre-development and already pre-sold 70% of the units during the bond marketing process. Approximately $135 million of tax-exempt, fixed-rate bonds were issued by HJ Sims. Sinai Residences also financed a portion of the development costs with taxable bonds, creating a $5 million taxable tranche of entrance fee principal redemption bonds.
The whole bond series were oversubscribed and priced at 5.00% to yield 4.60%, and that increased the CCRC’s maximum annual debt service by $2.4 million. Sims also facilitated the implementation of modifications to Sinai’s existing master trust indenture by switching testing of the debt service coverage from quarterly to annual.