INDIANA – September 22, 2016 – AMS Health Care Mortgage Corporation, Piper Jaffray & Co. and JLL Capital Markets jointly announced today the closing and funding of a $266,600,300 FHA/GNMA-insured mortgage loan for Union Hospital in Terre Haute, Indiana.
Founded in 1892, Union Health provides care for the 277,657 residents of West Central Indiana and Eastern Illinois. The regional healthcare system is comprised of the flagship Union Hospital (Terre Haute), a 347-bed acute care hospital; Union Hospital Clinton, a 25bed critical access hospital; and two rural health clinics (Clay City, Indiana and Marshall, Illinois), employing a total of 2,878 physicians and staff. The loan, insured under HUD’s Section 242 Mortgage Insurance for Hospitals program, significantly reduces the system’s annual debt service, saving Union Health and its patients approximately $148,000,000 over the life of the loan.
The team members assisting Union Health in obtaining the HUD loan commitment through successful execution have significant healthcare lending and finance experience. AMS is an FHA-approved mortgage lender that specializes in obtaining financing for hospitals and is consistently a leading originating banker for Section 242 loans. Piper Jaffray, a leading investment bank specializing in healthcare finance, worked closely with AMS in structuring the transaction, assisting Union Health in defeasing its existing tax-exempt debt and placing the GNMA securities with end investors. JLL, working closely with AMS and Piper Jaffray is the FHA Mortgagee of Record and will service the loan over its 25-year term.
Executive vice preident and chief financial officer Wayne Hutson, of Union Hospital, stated, “This refinancing positions Union Health well to continue its mission for the future in serving the healthcare needs of the people in the communities we are committed to serve. HUD’s Section 242 Mortgage Insurance program allows Union Health to realize meaningful savings, deleverage the organization and enhance the financial health of our organization. For our patients, this means we can continue to offer cost-effective care and expand our program offerings for the health and well-being of the people in the communities we serve, now and in the future.”
AMS and Piper Jaffray worked jointly from the inception of the engagement and partnered closely with the HUD and hospital teams to procure the FHA mortgage insurance commitment. Joseph Spiak, president of AMS, Romy McCarthy, managing director at Piper and Matthew O’Grady, principal at Piper Jaffray, jointly stated, “It has been an honor and privilege to serve Union Health and its communities. The flexible terms of the program and the broad distribution of securities to end investors resulted in one of the lowest interest rates achieved for a healthcare system participating in HUD Hospital Facilities program.”
Brian Kelleher, international director at JLL stated, “We were pleased to team with Union Health, AMS and Piper Jaffray in successfully completing this transaction. JLL’s healthcare team, offering a full suite of healthcare services, including loan servicing, looks forward to its long-term relationship with Union Hospital.”