One of the top CCRCs in Connecticut, Meadow Ridge in Redding, was developed nearly 20 years ago by Senior Care Development (SCD) and continues to thrive. Occupancy remained reasonably steady during the pandemic, and while the health center lost census in April and May (who didn’t?), it is back to pre-COVID levels. During the pandemic they separated the residents in the healthcare center into a COVID wing and a non-COVID wing.
The big news, however, is twofold. First, SCD completed an $80 million refinancing of the community with Truist at a much lower interest rate than was on the books, providing a nice annual savings. After an interest rate swap, the rate was in the mid-3’s for 10 years. Not too shabby, and closer to what you might see in the tax-exempt market.
As part of the refinancing, Meadow Ridge will be converting 28 independent living units to 20 assisted living units and 14 catered living units with “specialized care,” and 20 assisted living units will be converted to memory care. Their existing assisted living units had been 100% full and there had been a growing need for separate memory care units. So, this change seems like a no-brainer.
The refinancing process started a while ago, with banker tours in February, and then the pandemic hit and it was put on hold. After the summer, the process geared up again and the Truist loan closed in early December. SDC was very happy with the bank’s performance.
The second part of the transaction was that Benchmark Living will become the new manager, replacing LCS. Benchmark owns and operates the Edgehill CCRC in nearby Stamford, Connecticut, where occupancy is over 95%. Obviously, they are doing something right, or more appropriately, a lot of things right.
The Edgehill executive director will be moving to Meadow Ridge, and all the employees at Meadow Ridge will now be Benchmark employees. The final kicker is that Benchmark has taken a 15% ownership position in Meadow Ridge. Apparently, when Truist Senior Care group provides financing to CCRCs, they require the manager to have an equity stake. Nothing like having the interests of all parties in alignment.
For Benchmark, controlling the two major CCRCs in Fairfield County is quite a coup, and their locations are just far enough apart that they usually don’t compete for the same customer. But if there is no room at the inn at one of them, they can now refer customers to the other. How sweet it is. Maybe we will have to make another visit up the road to Meadow Ridge to see some of the changes.