PRAIRIE DU SAC, Wis. (May 28, 2013) – Sauk Prairie Memorial Hospital & Clinics (SPMHC), located in Prairie du Sac, Wis., recently funded $68 million for a replacement hospital, according to Steve Kennedy, senior vice president and regional manager with Lancaster Pollard, a national investment banking and mortgage banking firm headquartered in Columbus, Ohio. The firm was responsible for structuring and funding the debt offering.
"Lancaster Pollard was engaged to evaluate a number of financing structures for the construction project," said Kennedy. "Together with the Sauk Prairie leadership team, we selected the funding option that would provide the hospital with the optimal blend of the lowest cost of capital, most flexible terms and most favorable timing, enabling the hospital to move forward with the construction of its new facility as quickly as possible."
SPMHC is a 36-bed community hospital with four clinics located in its service area. It opened in 1956 and has grown significantly over the years. The aging facility inhibited efficient work flow, caused patient privacy concerns and presented building code challenges, prompting hospital leadership to build a replacement facility.
The two-part funding structure, a combination of tax-exempt, fixed-rate, unenhanced revenue bonds and tax-exempt, variable-rate revenue bonds enabled SPMHC to fund the entire project as envisioned and to start construction as soon as possible. SPMHC publicly issued $38 million in tax-exempt, fixed-rate, 35-year bonds, which were rated Ba1 by Moody's Investor Services. For the remaining $30 million, a group of four regional and community banks purchased tax-exempt, variable-rate bonds for a 10-year term. The blended interest rate is about 4.5%, providing the hospital a low cost of capital for the project.
"The new hospital will be the future of health care in our community," said Larry Schroeder, Sauk Prairie's CEO. "We take great pride in providing high quality care to our patients and will continue to do so in this modern medical facility designed to ensure healing, safety and efficiency in a private, welcoming environment."
The new 140,000-square-foot, state-of-the-art hospital will be located on a 115-acre campus. It will feature expanded surgical services, including six large operating rooms and 21 private prep and recovery rooms. Designed with an emphasis on privacy and dignity, there will be separate public and private corridors. Orthopedic care will include a joint replacement center, specially designed for patients undergoing hip or knee replacements, featuring a rehabilitation gym and dedicated space for patient education, group therapy and shared meals. The obstetrics unit will have five large labor and delivery rooms as well as a dedicated C-section suite in a secluded and secure area of the hospital.
Lancaster Pollard helps health care, senior living and housing organizations expand and improve their services by providing financing solutions. The firm offers a full range of investment banking, mortgage banking and investment advisory services and has one of the largest groups of financial professionals dedicated to health care in the country. As a leading underwriter of bonds and mortgages, Lancaster Pollard has earned a reputation for delivering sound financial advice and the most cost-effective financing options available in the market.
For more information about Sauk Prairie Memorial Hospital & Clinics or other hospital financings, visit www.lancasterpollard.com/hospital-financing.aspx.