Ziegler closed nearly $40 million in financing for a not-for-profit CCRC client in Palmyra, Pennsylvania, securing both institutional investor and bank support for the transaction. After originally opening the community in 1979, Lebanon Valley Brethren Home, dba Londonderry Village, is planning on expanding on a portfolio of a 40-acre tract of farmland it already owned south of the campus. It currently features 374 independent living units, 38 personal care/assisted living units and 88 skilled nursing beds, but the project would add 35 new IL units in 11 cottages/townhouses and two 12-unit buildings. There would also be a sales office and clubhouse added to the site.
To fund the project, plus refinance existing debt obligations and fund capitalized interest, they received $39.235 million in bond proceeds, $17.4 million of which (Series A) were sold publicly to institutional investors and $21.835 million (Series B/C) were placed with Fulton Bank. The Series A bonds, which did not include a debt service reserve fund, are tax-exempt, fixed-rate serial and term bonds that amortize over 25 years.
Demand for the bonds led to a five-basis point drop in yield from pre-pricing for the serial bonds and a 15-basis point drop for the term bonds. The Series B/C bonds are structured as non-bank qualified, tax-exempt debt, $7.5 million of which will be retired with the initial entrance fees from the project. They also came with a 10-year bank maturity and interest rate of 83% of SOFR, plus 1.41%.
Ascension Capital Advisors served as Municipal Advisors on the transaction and brought on Ziegler through an RFP process. However, Ziegler had previously served as Remarketing Agency for the community’s Series 2006 variable rate demand bonds.
