Redstone Village
Redstone Village CCRC Extends Forbearance With Bondholders; Occupancy Is Up Since the Summer, but New Sales Have Slowed
Tue 10/26/2021 18:08 PM
Relevant Documents:
Issuer Page
EMMA Filing (Oct. 25)
UMB Bank, the bond trustee on $80.7 million in total debt issued to Redstone Village CCRC in Huntsville, Ala., will extend the forbearance period to Dec. 15, according to market sources.
The borrower and a majority of bondholders first entered into a forbearance agreement in November 2018 and ultimately extended it to Sept. 30, 2021.The forbearance agreement was precipitated by noncompliance with liquidity targets, debt service coverage ratio, or DSCR, certain occupancy targets and provisions, resulting from operating losses for the years 2017 through 2019.
Redstone Village comprises 112 independent living units, 60 assisted living units, 40 skilled nursing beds and a 32-bed memory care unit for patients with Alzheimer’s disease and other cognitive impairments. Eight outstanding series of bonds, secured by a mortgage on the campus and operating revenue, were issued from 2007 through 2012 in connection with various expansions and refinancings.
The community reported net operating income, or NOI, of $123,873 in September, with an unfavorable variance of $67,810, compared with budget. Year-to-date NOI is $1.6 million through Sept. 30, according to an Oct. 25 EMMA filing. The debt service coverage ratio of negative 0.3x missed the budgeted 0.52x, which includes net turnover entrance fees totaling negative $281,721.
Redstone Village reported 57 days’ cash on hand, or DCOH, as of Sept. 30. Its liquidity covenant requires a minimum of 120 DCOH. The community reported $77 million in total assets versus $145.6 million in total liabilities, for a net deficit of $68.6 million.
Redstone Village reported total occupancy of 79% as of Sept. 30. Skilled nursing paced performance at 89%, but segment occupancy decreased 9% from August. Redstone Select, an affordable independent living option featuring a la carte services, lagged behind all segments at 58%.
Independent living occupancy, where most of Redstone Village’s entrance fees are collected, held steady at 78% as of Sept. 30. That’s up from 74% in June, but net independent living sales decreased from 10 in June to four in September. Redstone Village’s independent living occupancy is 12 percentage points below its 90% covenant target.
Redstone Village did not respond to a request for comment.
-- Chuck Sudo
Issuer Page
EMMA Filing (Oct. 25)
UMB Bank, the bond trustee on $80.7 million in total debt issued to Redstone Village CCRC in Huntsville, Ala., will extend the forbearance period to Dec. 15, according to market sources.
The borrower and a majority of bondholders first entered into a forbearance agreement in November 2018 and ultimately extended it to Sept. 30, 2021.The forbearance agreement was precipitated by noncompliance with liquidity targets, debt service coverage ratio, or DSCR, certain occupancy targets and provisions, resulting from operating losses for the years 2017 through 2019.
Redstone Village comprises 112 independent living units, 60 assisted living units, 40 skilled nursing beds and a 32-bed memory care unit for patients with Alzheimer’s disease and other cognitive impairments. Eight outstanding series of bonds, secured by a mortgage on the campus and operating revenue, were issued from 2007 through 2012 in connection with various expansions and refinancings.
The community reported net operating income, or NOI, of $123,873 in September, with an unfavorable variance of $67,810, compared with budget. Year-to-date NOI is $1.6 million through Sept. 30, according to an Oct. 25 EMMA filing. The debt service coverage ratio of negative 0.3x missed the budgeted 0.52x, which includes net turnover entrance fees totaling negative $281,721.
Redstone Village reported 57 days’ cash on hand, or DCOH, as of Sept. 30. Its liquidity covenant requires a minimum of 120 DCOH. The community reported $77 million in total assets versus $145.6 million in total liabilities, for a net deficit of $68.6 million.
Redstone Village reported total occupancy of 79% as of Sept. 30. Skilled nursing paced performance at 89%, but segment occupancy decreased 9% from August. Redstone Select, an affordable independent living option featuring a la carte services, lagged behind all segments at 58%.
Independent living occupancy, where most of Redstone Village’s entrance fees are collected, held steady at 78% as of Sept. 30. That’s up from 74% in June, but net independent living sales decreased from 10 in June to four in September. Redstone Village’s independent living occupancy is 12 percentage points below its 90% covenant target.
Redstone Village did not respond to a request for comment.
-- Chuck Sudo
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