CHICAGO - The Illinois Finance Authority board this week advanced new-money and refunding deals planned by Northwestern Memorial Healthcare and the Franciscan Communities Inc. in the coming months.

The IFA board gave final approval at a meeting Tuesday to Northwestern's sale of up to $150 million to refund about $103 million of outstanding debt and to finance or reimburse itself for capital projects.

The primary spending is for the system's new parking facility and daycare center, and the renovation and equipping of several floors at its flagship downtown Chicago hospital.

The hospital carries ratings of AA-plus from Standard & Poor's and Aa2 from Moody's Investors Service on $840 million of debt. The financing likely will offer fixed-rate bonds. JPMorgan is the underwriter, Kaufman Hall is financial advisor, and Jones Day is bond counsel.

Moody's said in a review last year the rating was supported by the hospital's "prominent and growing market position in the greater Chicagoland area with strong patient demand and volumes, an excellent investment position providing good coverage of debt, sustained and strong operating margins, and manageable debt structure risks."

The hospital's challenges include a somewhat high leverage position, increasing competition in a consolidating market, and sizable grants to the Feinberg School of Medicine and Northwestern Medical Faculty Foundation.

In addition to its downtown hospital and downtown Prentice Women's Hospital, the system operates a hospital in the north suburb of Lake Forest which also operates an outpatient campus in Grayslake. The hospital has been in the news lately over a battle with preservationists over the fate the Bertrand Goldberg-designed former Prentice home. The hospital wants to demolish the building to make way for a new research building.

The IFA board gave final approval for the Franciscan's proposed sale of up to $160 million of revenue debt. The deal includes a refunding of debt previously sold through the Indiana Health Facility Financing Authority and Cuyahoga County, Ohio, for the senior care provider's facilities in those states.

The sale also would raise about $18 million in new money for various projects at the Franciscan Communities' eight facilities in Illinois, Indiana, and Ohio. The borrower is considering a structure that includes a mix of fixed-rate tax-exempt bonds and taxable and tax-exempt variable-rate securities directly placed.

The borrower expects to receive a BBB-minus rating, the lowest investment grade level, from Fitch Ratings. The Franciscan Sisters of Chicago Service Corporation is the sole corporate member of the borrower. It provides community-based housing and healthcare services to seniors. BB&T Capital Markets is underwriter and Jones Day is bond counsel.

The board also gave initial approval to Plymouth Place, Inc.'s proposed issue of up to $35 million to finance the costs of acquiring, constructing, and renovating facilities at its LaGrange, Ill. campus and refunding up to $20 million of outstanding debt. The campus underwent a major redevelopment in 2005 funded with a $146 million borrowing through the IFA.

The bonds are expected to be sold in a public offering at a fixed rate with no rating. The debt would be secured by a first mortgage on property and equipment and a gross revenue pledge. Ziegler Capital Markets is the underwriter.

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