Ziegler announced the successful closing of Friendship Village of Tempe’s $107.525 million Series 2025AB bonds through the Industrial Development Authority of the City of Tempe, Arizona.
Tempe Life Care Village, Inc. owns and operates a CCRC known as Friendship Village of Tempe (FVT) in Tempe, Arizona. FVT consists of a 536-unit retirement center, a 128-bed skilled nursing center, a 67-unit assisted living building, 24 memory care beds and a 14-bed hospice unit in the Health Center that is leased to a hospice provider. The bonds will be used to fund Phase Three of the corporation’s campus master plan.
Phase Three is a new five-story building known as the Ironwood building, with 69 entrance-fee apartments on five floors, underbuilding parking, amenities on the first floor including a salon, an assistance in living clinic, group exercise room, and multi-use club rooms, as well as a new restaurant/sports bar on the fifth floor. This building will replace an existing three-story building with 86 apartments that the not-for-profit has determined is functionally obsolete because of market demand for larger apartments with amenities that cannot be provided in the current building.
This transaction marks Ziegler’s tenth transaction with Friendship Village of Tempe since 1980, totaling $514.41 million in par amount. The bonds are exempt from Federal and State of Arizona income tax. The 2025A bonds are being wrapped around the corporation’s existing 2019 & 2021AB bonds to result in level aggregate annual debt service, and are subject to optional redemption on December 1, 2032, at 103, declining to par in 2035. The 2025B bonds are Tax-Exempt Mandatory Paydown Securities and are expected to be repaid at approximately 75% occupancy of Phase Three.
In addition to funding the project, proceeds of the bonds will be used to refinance a taxable obligation of the borrower, fund a debt service reserve fund for the bonds, pay capitalized interest on the bonds for a period of 31 months, and pay certain costs of issuing the bonds.
