Health Care Finance
In recent years, we have completed several hundred M&A transactions with multi-state providers of health care services. Our experience includes representing borrowers in the financing of skilled nursing facilities through US Department of Housing and Urban Development insured financing transactions under Sections 223(f) for senior housing facilities and 232 of the National Housing Act for nursing home and assisted living facilities. We handle transfers of physical assets of facilities with existing HUD financing and assist third-party tenants/operators in connection with these transactions and have particular experience in navigating the challenges that arise when operators have accounts receivable or other financing. We have represented borrowers in numerous bridge-to-HUD financings.
We also represent private equity funds and other sources of equity to the health care industry, as well as lenders to public and private businesses that operate skilled nursing, assisted living, continuing care, retirement, and independent living facilities. We represent buyers and sellers of nursing homes, assisted living and independent living facilities, and a variety of ancillary service businesses in hundreds of transactions throughout the country. Our attorneys have years of experience in starting, financing, and growing early stage, venture-backed health care companies. We advise clients on the regulatory and transactional legal issues faced by companies during accelerating growth.
Arent Fox has participated in a variety of health care facility financings as bond counsel, borrower's counsel, underwriters' counsel, or credit enhancement provider's counsel. These financings have involved hospitals, ambulatory centers, senior living facilities, medical office buildings, and nursing homes and other long-term care facilities. Representative projects include:
- AIDS facilities. We have worked as bond counsel on one of the first publicly financed AIDS facilities in the country. We have also worked on a pooled financing for nine AIDS adult day care facilities mostly for facilities located in New York City, with security provided by SONYMA and 14 AIDS facilities financed on a pooled back in Washington, DC, by the Whitman Walker Clinic.
- Civic facility. We acted as the first bond counsel to the District of Columbia and helped establish its conduit revenue bond program, have worked on the first industrial development agency hospital financing under the New York IDA Reform Act, and have drafted and implemented legislation authorizing financings for a range of civil improvements from parks to sports venues. With respect to the IDA Reform Act, we provided the health care perspective to the drafters of the legislation.
- Dormitory authority. Arent Fox served as bond counsel on the New York Dormitory Authority’s first health care transaction after its transition as the state’s primary health care issuer, requiring extensive discussions with the New York State Department of Health and the Dormitory Authority.
- Fiscal assistance. Our lawyers wrote the District of Columbia Financial Control Board legislation and assisted the City of New York with its financial crunch by completing the issuance of nearly $600 million in health facilities revenue bonds, which helped save the city approximately $50 million. We also represented Prince George’s County, Maryland, in utilizing alternative public financing techniques to address voter-imposed tax limitations (TRIM).
- Life care. We served as underwriter’s counsel for various public hospital transactions, including two of the first life care community developments in the State of New York. As underwriter’s counsel, we created the disclosure for this unique financing. We are also handling the workout of one, and have handled the restructuring of four other life care projects in the mid-Atlantic.
- Pooled financings. One of our lawyers served as underwriter’s counsel on one of the largest FHA‑insured pooled financings, requiring separate disclosure on each institution. Because the five nursing homes did not receive the savings from this refinancing, we drafted the disclosure for each of the nursing homes as well as coordinated the financing efforts.
- Privatization. We worked as special privatization counsel to the New York City Economic Development Corporation with respect to the disposition of three New York City Health and Hospitals Corporations hospitals – Coney Island, Elmhurst, and Queens hospitals. This transaction is one of the largest and most complicated privatizations undertaken in the United States.
- Work-out. We have handled numerous failed nursing homes, which involve such issues as transfer of certificates of need, approvals by local and state regulatory agencies, assignment of existing federal contracts, dealing with allocation of environmental liability, substantial official statement disclosure, satisfaction of outstanding bondholders and other secured creditors, and resolving the tax consequences of the transfer.
- RTC. Arent Fox represents the Resolution Trust Corporation in creating its tax-exempt bond work-out program and in devising its matter and special servicer protocols and form agreements for use in the municipal bond context.