Sonida Senior Living Announces Completion of Loan Modifications with Fannie Mae and Updated Performance Highlights Through Q3
Sonida Senior Living, Inc. (NYSE:SNDA), a prominent owner-operator of communities and services for seniors, has announced the successful execution of its loan modifications with Fannie Mae, alongside robust September and Q3 2023 occupancy growth. These developments mark a significant milestone for the company as it continues to strengthen its financial position and enhance its operational excellence.
In June 2023, Sonida entered into a comprehensive forbearance agreement with Fannie Mae, initiating a two-step process to modify all existing mortgage agreements. On October 2, 2023, Sonida and Fannie Mae finalized loan modification agreements covering all 37 Fannie Mae mortgaged communities. The terms of these modifications align with the previously announced forbearance agreement, ensuring a smooth transition for the company.
Key elements of the loan modifications include the commitment from Conversant Capital to purchase up to $13.5 million of common equity at $10 per share over an 18-month period. Sonida has the option to utilize Conversant’s equity commitment as needed for general working capital or to fund loan paydowns. In July, the company drew $6.0 million from this commitment, in conjunction with the first $5.0 million principal payment to Fannie Mae. The remaining funds can be accessed to meet future financial needs.
Additionally, Ally Bank has agreed to temporarily reduce the minimum liquidity requirement under its $88.1 million facility with Sonida for 18 months, subject to certain conditions. This modification provides further support to the company’s ongoing financial stability.
The completion of the loan modifications with Fannie Mae, along with the adjusted liquidity requirements with Ally Bank, significantly contribute to Sonida’s financial stability. The company remains optimistic about positive outcomes in its ongoing dialogue with Protective Life, another significant lending partner, regarding potential modifications or repurchases.
Sonida’s Q3 performance showcases its continued growth and success. The company’s owned communities achieved a spot occupancy rate of 86.8% in September, with average occupancy for Q3 increasing by approximately 100 basis points compared to Q2 2023. Notably, Sonida’s average rate has experienced a year-over-year increase of 9.8% through the first nine months of the year, contributing to the company’s NOI margin expansion.
Kevin Detz, Chief Financial Officer of Sonida, expressed enthusiasm about the company’s momentum as it enters the final quarter of the year. He attributed the strong results and sequential improvement throughout the year to the team’s dedication to operational excellence and providing high-quality care and personalized service to enhance residents’ quality of life.
Brandon Ribar, President and CEO of Sonida, expressed satisfaction with the company’s operating results and the completion of the loan modifications with Fannie Mae. He emphasized that Sonida’s performance, coupled with ongoing support from investors and lenders, sets the company apart in the current economic climate. Ribar believes that Sonida is well-positioned for growth, with its balance sheet repositioning nearing completion and continued portfolio performance improvement.
Sonida Senior Living, Inc. is a Dallas-based company that owns and operates independent living, assisted living, and memory care communities for senior adults. With 71 senior housing communities across 18 states and approximately 8,000 residents, Sonida is committed to providing compassionate, resident-centric services and care. The company’s dedication to operational excellence and its focus on growth make it a standout player in the senior living industry.
For more information about Sonida Senior Living, Inc., visit their official website or connect with them on Facebook, Twitter, or LinkedIn.