USDA approves loan for Castle Peak Senior Care Community
October 2, 2013
Castle Peak Senior Care Community, the 64-unit skilled nursing and assisted living community to be located in Eagle Ranch, has secured a $12 million loan through the USDA Rural Development’s Community Facility Loan Program.
Approval of the loan is a major step in making the project a reality.
The need for a care community is well documented. Recent projections from the Colorado State Demography Office show Eagle County’s population of those 65 and older is forecast to grow by 159 percent between 2010 and 2020, the fastest in the state. The non-profit Augustana Care is partnering with the county to develop the new care community.
The $12 million loan, which combines a 3.5 percent interest rate with a 40-year term, is a key component in the project’s financial structure and will allow the project to be self-sustaining. “We sized Castle Peak’s long term debt so the project’s cash flows would be able to cover its debt payments,” said Augustana Care’s Chief Financial Officer Craig Kittelson.
“The low interest rate and favorable term will go a long way in ensuring the success of the project,” he said.
Through the loan review process which began in February, the Castle Peak project gained support from Colorado’s senators and representatives. “This public-private partnership is a great example of how rural development resources can really benefit our local communities,” said Senator Michael Bennet. “This capital will allow Eagle County and Augustana Care to construct a much-needed assisted living and skilled nursing facility to provide high quality care for their seniors and prevent seniors from having to relocate,” Bennet said.
The county and Augustana Care will contribute a combined $5.4 million to the project in the form of subordinate debt, meaning these loans will only begin to receive repayments when the project has surplus cash. With an estimated total development cost of $21.8 million, that leaves a $4.4 million funding gap.
Augustana Care has launched a capital campaign supported by local community volunteers to secure these funds. “The USDA loan approval will provide the capital campaign with a huge wave of momentum and will hopefully help us reach our goal of breaking ground in late spring or early summer 2014,” said Merv Lapin, chair of the capital campaign committee.
With the loan secured, the project’s design team will proceed with the final building design and approval processes required by the town of Eagle and the Eagle Ranch Design Review Board.
The Castle Peak Senior Care Community will be the first of its kind in Eagle County and will include 20 assisted living apartments, 22 skilled nursing suites, 12 memory care suites and 10 transitional care or rehabilitation suites. Castle Peak will serve an estimated 110 people annually at all income levels. For more information, visit http://www.castlepeak.org.