Graceworks Raises $81M in Bonds for Repositioning, Refinancing

CENTERVILLE, Ohio — Graceworks Lutheran Services, a nonprofit continuing care retirement community located in the Dayton suburb of Centerville, has completed an $81 million bond refinancing to restructure its debt and renovate the campus.

The property, built in 1946, currently features 383 independent living units, 58 assisted living units and 252 skilled nursing beds. The repositioning will include demolishing a 22-unit assisted living wing, converting 36 assisted living units into 35 memory care units and constructing a 74-unit assisted living building. In addition, Graceworks will add a new activity room and renovate the common spaces, including the kitchen and dining areas.

The refinancing will improve debt capacity, enhance Graceworks’ credit profile, minimize interest-rate risk and eliminate bank renewal risk that was coterminous with construction completion. The refinancing of fixed-rate bonds reduced interest rates by 100 basis points and extended amortization by 12 years. This collectively reduced debt service by $3.8 million during the construction, and an overall average annual debt service reduction of $565,000.

The bonds were issued as nonrated, fixed-rate bonds with a 2050 yield of 4.79 percent. 19 different institutional investors purchased the bonds. Cain Brothers acted as investment banker on the financing.

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