SOURCE: Ziegler


September 16, 2009 11:07 ET

Ziegler Places First Start-Up CCRC Financing in 2009: $86 Million for 15 Craigside, Honolulu, Hawaii

CHICAGO, IL--(Marketwire - September 16, 2009) - The long-frozen senior living capital markets continue to show signs of thawing, with the markets reaching a new landmark in the successful pricing of just over $86 million fixed-rate bonds for 15 Craigside, a new continuing care retirement community to be built in the Nu'uanu suburb of Honolulu, Hawaii. The pricing, brought to market by Ziegler (PINKSHEETS: ZGCO), a growth-oriented boutique investment banking and investment services firm, marks only the fifth sizable senior living issue in 2009, the first start-up CCRC (Continuing Care Retirement Community) financing in more than 18 months, and the largest fixed-rate financing so far this year.

Craigside Retirement Residence, owner of 15 Craigside, is a Hawaii non-profit whose sole member is The Arcadia Foundation; other affiliates include Arcadia Retirement Residence, Arcadia Elder Services, and Arcadia Home Health Services. Arcadia Retirement Residence has a 40-year history of successful CCRC operations in the Honolulu market and brings that expertise and reputation to the development and operations of 15 Craigside.

15 Craigside will be a 13-story building located on a 1.5-acre site in Nu'uanu, northwest of Waikiki Beach, on the island of Oahu. The community will include 170 independent living apartments (ILUs), 41 nursing beds, 4 unlicensed nursing "boarder beds," and common areas including a pool, wellness, dining, and many other typical CCRC amenities. The ILUs will be licensed to provide assisted living services as needed by Arcadia Home Health Services.

"In the toughest months of an unforgiving financial environment and a frozen bond market, Ziegler was a key factor in keeping our dream and mission for this senior living community alive and within reach," said Emmet White, CEO of Craigside Retirement Residence. "Simply put, in these difficult times, Ziegler's continuous efforts to strive for Hawaiian pono enabled 15 Craigside to 'thaw' a much needed market for this new and most welcome continuing care retirement community in Honolulu."(1) [Pono means: Goodness, morality, rectitude, correct or proper procedure, excellence, well-being, duty and right.]

"The solid and enthusiastic response of the institutional bond market to a non-rated start-up senior living transaction is highly encouraging news for the senior living sector," said Mary Muñoz, managing director for Ziegler. "As clients across the country are re-evaluating growth and redevelopment opportunities, Craigside's success is a great positive indicator of market appetite."

Given the continued challenging Letter of Credit bank market, Ziegler structured both the short-term debt (to be repaid with entrance fees) and the long-term debt with term bonds and Ziegler's ARROS(SM) adjustable-rate bonds. The average yield on the short-term debt is 7.18%, and the average yield on the long-term debt is 9.12%, with a top yield of 9.15% on the 2044 term bond.

About Ziegler:

The Ziegler Companies, Inc. (PINKSHEETS: ZGCO) is a growth-oriented boutique investment banking and investment services firm with a primary focus in the healthcare, senior living and church and school sectors. Operations encompass capital markets (capital advisory services, bond underwriting, mortgage banking, institutional sales and trading) and wealth management, including asset management and alternative investments.

Nationally, Ziegler's Capital Markets is ranked as one of the leading investment banking firms for non-profit healthcare and senior living providers, as well as religious institutions and schools.

Ziegler Wealth Management (retail brokerage) encompasses investment and consulting services for individuals, families, business owners and institutions nationwide.

Ziegler's alternative investing activities include raising and deploying capital through private investment funds with investment objectives related to the real estate, services and technology sectors of the healthcare and senior living industries.

Ziegler Capital Management, LLC provides separate account management for individuals, corporations, foundations and endowments. Total assets under management are approximately $1.8 billion.

(1) This client's experience may not be representative of the experience of other clients, nor is it indicative of future performance or success.

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