Columbus, OH (PRWEB) April 28, 2014
Red Capital Markets, LLC (MEMBER FINRA/SIPC), the investment banking arm of comprehensive capital provider RED CAPITAL GROUP, LLC, announced today that it served as financial advisor to the North Caddo Hospital Service District (“North Caddo”) to help it secure financing for construction of a new 25-bed replacement hospital facility. North Caddo is a public hospital district located in Vivian, Louisiana, approximately 50 miles north of Shreveport.
Originally built in 1965, the facility operates now with 15-acute care beds and 10 additional long-term care beds. As a result of the financing, the new, larger hospital will measure 70,501 square feet with an adjoining 9,621 square foot clinic. Construction will be completed in three phases allowing the existing hospital to continue operations during construction.
North Caddo sought out Red Capital Markets, LLC as a financial advisor to review funding options and draft a financing plan for the project. As a public hospital district in Caddo Parish, North Caddo has the ability to ask its residents to approve taxes to finance facility improvement projects. In 2012, North Caddo successfully obtained voter approval for a 25 year, 1% sales-and-use tax to be dedicated and used for any lawful corporate purpose for the District, including the construction of a new facility.
After reviewing market conditions and possible financing structures, Red ultimately guided North Caddo through the USDA Community Facilities Program (“USDA”) process to secure a commitment to purchase $20 million in fixed-rate bonds from North Caddo. Under Red’s direction, the hospital was able to obtain low fixed-rate financing enhanced by the USDA. The hospital was also able to obtain an additional $5 million by issuing a separate sales-tax bond.
Once the hospital received a commitment from the USDA for financing, North Caddo accelerated its architectural efforts and completed construction drawings a few months after commitment. The financing was structured in three series of bonds: $6.2 million in sales tax bonds (a 3.125% fixed interest rate and a 22-year final maturity), $13.8 million in revenue bonds (a 3.500% fixed interest rate and a 35-year final maturity) and $5 million in sales-tax bonds (a 4.500% fixed interest rate and a 20-year final maturity). Proceeds from the bonds, collections from the 1% sales tax levy and hospital equity will be used for land acquisition, equipment purchases and construction of the $27.8 million replacement facility.
Red Capital Markets, LLC’s lead banker Drew W. May said, “It was a pleasure working with David Jones and the North Caddo team on the USDA Community Facilities financing. We are pleased we were able to structure their bond issues to provide capital at very attractive rates in order to build this much needed facility. To secure a 3.60% blended fixed rate for approximately 30 years is simply a great outcome for the Hospital and the Caddo Parish community.
“We would have been lost in the process without RED Capital,” stated Administrator David Jones, “Their past experience helped speed our project up allowing us to get started on our replacement facility 12-24 months sooner. In the end, it was a team project and RED Capital was a large part of that team.”
About RED CAPITAL GROUP, LLC
Recognized for its industry expertise, innovative and comprehensive structures, and consistently high rankings, RED CAPITAL GROUP, LLC has provided over $55 billion of integrated debt and equity capital since 1990 to the multifamily, student and seniors housing, and health care industries through three operating companies. Red Mortgage Capital, LLC is a leading Fannie Mae DUS® and MAP- and Lean-approved FHA lender with a mortgage servicing portfolio of more than $17.8 billion. Red Capital Markets, LLC (MEMBER FINRA/SIPC) is a leader in the distribution of Fannie Mae and Ginnie Mae Project MBS and provides structuring, underwriting, placement and advisory services for tax-exempt and taxable housing and health care bonds. Red Capital Partners, LLC provides proprietary debt and equity solutions and asset management in a range of forms including subordinated gap and bridge loans. RED CAPITAL GROUP, LLC, a subsidiary of ORIX USA Corporation, is headquartered in Dallas, Texas, with a large regional office in Columbus, Ohio and nine additional offices nationwide.
About ORIX USA Corporation
ORIX USA Corporation is a diversified financial company with approximately $6 billion of assets in sectors spanning commercial finance, venture finance, commercial real estate and public finance, as well as $25 billion of assets managed for others. Operating subsidiaries include Houlihan Lokey, RED Capital Group and Mariner Investment Group. Headquartered in Dallas, Texas, ORIX USA and its subsidiaries have more than 1,400 employees and offices in major cities including New York, Los Angeles, London and Tokyo.
ORIX USA is a wholly owned subsidiary of ORIX Corporation, a Tokyo-based, publicly owned international financial services company with operations in 35 countries worldwide. ORIX Corporation is listed on the Tokyo (8591) and New York Stock Exchanges (IX). For more information on ORIX USA, visit http://www.orix.com.