The Capital Issue

Winter 2010

This season's edition of The Capital Issue focuses on financing options that are helping providers get projects done despite the tight economy. We also discuss active vs. passive management in The Nonprofit Minute, a discussion nonprofit investors should consider as they seek to reduce fees and restructure their portfolios to weather market shifts. If you have any questions on these topics or would like us to visit in person to explain them, please don't hesitate to contact us.

Thomas R. Green, CEO

Short-Lived Financing Options Can Make Capital Projects Feasible in a Tough Economy
1/4/2010

Short-Lived Financing Options Can Make Capital Projects Feasible in a Tough Economy

It could be said that if the credit markets were not so risk-averse right now, it would be an incredible time to issue debt for expansions, renovations, acquisitions or refinances. Construction costs remain low, and the 10-year treasury rate, an indicator of base interest rates with no risk pricing built in, has been hovering under 4 percent – compared with 6 percent in the late 1990s and 9 percent in the 1980s.

More Hospitals To Become Eligible to Refinance Through HUD
1/3/2010

More Hospitals To Become Eligible to Refinance Through HUD

The first public option to refinance hospital debt will be made viable for more hospitals if proposed changes are codified later this spring. The new eligibility standards for HUD mortgage insurance, announced in late January, would enable more hospitals, including those below investment grade, to reduce interest rates, exit troubled banking relationships, extend debt amortizations or otherwise alter existing hospital debt structures.

Financing Senior Living in 2010: The Art of the Senior Living Financing Deal
1/3/2010

Financing Senior Living in 2010: The Art of the Senior Living Financing Deal

Despite poor market conditions in 2009, there remain a demand and need for senior living facilities nationwide. Properties continue to seek financing for expansions, rehabilitation, acquisition and even new construction. The projects being financed speak to the importance of strong underwriting in a tough market. In the second half of 2009 and in early 2010, Lancaster Pollard financed senior living facilities with bank qualified private placements, Fannie Mae, HUD/FHA Section 232/223(f) and traditional letter of credit enhancements, among other financing options.

Financing Options in the Era of ARRA
1/2/2010

Financing Options in the Era of ARRA

Shovel-ready affordable housing projects received a jump-start in 2009 with support from two American Recovery and Reinvestment Act (ARRA) programs. The programs are designed to ensure funding is available for multifamily affordable housing projects that have been in the pipeline since 2007.

Comparing Active vs. Passive Management
1/1/2010

Comparing Active vs. Passive Management

Manager selection is an important part of constructing an institutional investment portfolio; however, before deciding on a specific investment manager, institutional investors must first decide whether to use active management or passive management.