Fitch Ratings last Thursday upgraded bonds issued for Greenspring Village Inc., a continuing-care retirement community in Springfield, Va., to A from BBB-plus.
The upgrade affects $60.9 million of fixed- and variable-rate bonds issued in 2006 by the Fairfax County Economic Development Authority. Fitch also revised the outlook to stable from positive.
The upgrade to A is based on the CCRC’s consistently high occupancy levels and excellent cash flow that has supported liquidity growth, robust debt-service coverage, and a favorable service area, Fitch said.
The facility is southwest of Washington, D.C., and has 1,408 independent-living units, 146 assisted-living units, and 136 skilled-nursing beds. The independent-living units had an occupancy level of 98.7% in February while the assisted-living units and nursing bed occupancies have ranged from the mid-to-high 90% range since 2007, according to Fitch.
Greenspring’s cash flow supports debt-service coverage of 5.5 times and an increase of cash and unrestricted investments of about $10 million in 2010. Liquidity as of Dec. 31 was deemed strong with 427.7 days cash-on-hand, and a cash-to-debt ratio of 121.8%.
The CCRC’s bonds are secured by a gross revenue pledge, a deed of trust that consists of a mortgage lien, and a debt-service reserve fund, Fitch noted.