$60 million financing will stabilize senior-living center

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I’m 32 and so a long way from needing to think about moving to a senior-living community. So when Judy Marczewski, the chief financial officer for Leisure Care Retirement Communities, asked me whether I had been to her Mackenzie Place Union facility in Colorado Springs, I didn’t really know how to respond.

Marczweski, as it turned out, wasn’t interested in my long-term plans. Instead, she’s eager to get the word out on how her communities don’t fall in to traditional retirement housing categorizations.

“We provide our residents with opportunities to learn and experience new things,” she said. “Whatever your idea is of a retirement community, we aim to blow that out of the water. It’s not just bingo going on here.”

And now she’ll have the capital to build on that vision.

Last month Boston-based HJ Sims & Co., which owns a controlling stake in the Mackenzie Place, landed $60 million in financing to stabilize its Colorado Springs and Fort Collins operations.

With 36 properties and more than 4,000 units, HJ Sims is one of the largest proprietors of senior housing in the country. But as the spate of recent bankruptcies and foreclosures in the real estate market show, there are no guarantees when it comes to securing additional funding.

Development on the Mackenzie Place began in 2006, and it opened for business in 2008.

“I don’t care if you’re a hot-dog stand or a senior-living community, it was a really tough time to open anything,” HJ Sims Vice President James Scribner said of the period. “We needed a lot more working capital than we initially contemplated, which left us seeking a partner to recapitalize the project.”

The original lender was fighting to get the property off its books by the end of September, leaving HJ Sims and Leisure Care a very small window to find new financing.

Fortunately, two of the country’s largest institutional lenders saw value in the project and stepped forward. Fidelity Real Estate Group and UBS Global Asset Management partnered on a five-year, fixed-rate $60 million loan.

The proceeds will be used to complete a discounted payoff of construction loans, and will ensure that the Colorado Springs and Fort Collins communities have time to fill remaining vacancies.

“It was a struggle because the credit markets are so tight,” Scribner said. “But senior housing is performing very well, and once we showed (Fidelity and UBS) the quality of the project and market, and the quality of our manager, Leisure Care, they decided that there weren’t a lot of other opportunities to invest in cash-flowing businesses with this kind of upside.”

That’s rare good news for businesses in this tight lending environment, and ensures that you’re have plenty of time to check out the indoor pools, salons, spas, billiards rooms, libraries and movie theaters Mackenzie Place Union has to offer.

It also beats having to write a column about contractor liens on a senior living community.

Coroner upgrade

El Paso County’s purchase of $25 million in office buildings at the former Intel compound was, of course, welcome news for the Clerk and Recorder’s Office, Treasurer’s Office, Assessor’s Office, Department of Human Services, Department of Health and Environment and the Pikes Peak Workforce Center. Those entities will benefit from improved conditions at shiny, new digs.

It also set off a game of musical chairs for the county divisions that will inhabit the spaces vacated in the relocation. For example, the county’s administrative offices are off to Centennial Hall, while the Sheriff’s Office will take over the County Office Building. But it’s the entity that was last in line that has the biggest reason to celebrate.

The Office of the County Coroner may not have landed in prime real estate, but it’s still the biggest beneficiary in the reshuffling. County Coroner Robert Bux has been working with an administrative team crammed into the same space where autopsies, forensics and pathology are performed.

The coroner’s administrative staff will tumble into the old Sheriff’s office.

“They’ve been very overcrowded,” said Director of Public Services Monnie Gore. “Right now it’s just one small room for the doctors and labs. There’s equipment sitting in the garage and materials and supplies stored everywhere. Now they’ll pick up the Sheriff’s training academy and be able to grow into that.”

But the coroner’s office could still use some work. There is currently only one HVAC system serving the entire building, meaning that the air from the autopsy room gets circulated throughout.

I’ll leave it to the reader to speculate on the quality of that air.

Jonathan Easley can be reached at jonathan.easley@csbj.com or 719-329-5208. Find him on Facebook or Twitter.