HJ Sims Advises $10.6M Permanent Financing for Community in the Southwest

by Jeff Shaw

FAIRFIELD, Conn. — HJ Sims, a Fairfield-based investment bank and wealth management firm, acted as financial advisor in securing a $10.6 million life insurance company loan. The transaction marks a unique conclusion to a two-year plan with a returning client for the refinance of an assisted living and memory care community in the Southwest.

The borrower is a regional owner-operator that currently manages a portfolio of 19 communities in the West. The borrower partnered with Sims in 2021 to close on the acquisition of the value-add, pre-stabilized community.

Since the acquisition, the borrower successfully refreshed the building, and slightly raised monthly rental rates while also increasing census to over 95 percent occupancy. However, with increased expenses and labor costs felt industry-wide, combined with an ever-changing interest rate environment, the options for permanent debt to refinance out the entire high-leverage bridge loan were becoming more and more constrained.

The fixed-rate debt was structured at a 70 percent loan-to-value ratio, with a five-year term, including 24 months of interest only, followed by a 30-year amortization. In addition, terms were negotiated to include the ability to pay off the loan with no penalty any time after the first 18 months.

Further details on the property were not disclosed.

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