This article by John Lippman was published July 21 in the Valley News.
WHITE RIVER JUNCTION — A lender who provided critical refinancing to The Village at White River Junction will become the new owner of the senior assisted living and memory care facility.
Columbia Pacific Advisors, a lender that provided a $29 million refinancing loan to the project, which has been billed as a keystone in downtown White River Junction’s economic revival, is acquiring the 80-unit facility for an undisclosed price, the parties said in a news release on Monday.
The announcement caps what has been a sometimes bumpy road for The Village since it opened its doors early in 2019, initially with cost overruns during construction and then in filling occupancy and facing cash-flow shortfalls. At present, about 88% of the units are occupied, according to Executive Director Nikki Fortier.
In the news release, the founders and outgoing principals, Byron Hathorn and Brooke Ciardelli, were silent on the reason they were transferring ownership of The Village after investing nearly six years in shepherding the high-profile project from conception through development and operation.
But Alan Spragins, an executive at Columbia Pacific Advisors, explained in an email to one of The Village residents last week that “the owners of The Village at White River Junction have failed to pay their debt. As a result, we had to take ownership of the property,” according to the email, a copy of which was provided to the Valley News.
(The resident initially had reached out to Spragins last week to inquire if Columbia Pacific Advisors would be making changes at The Village as a result of its purchase of the facility).
The Columbia Pacific firm, which provides specialized financing to commercial projects around the country — including numerous assisted living facilities — stepped in to provide a $29 million “stabilization and bridge” loan to The Village, and described it in a trade publication ad earlier this year as to “refinance the construction loan on a newly constructed high-end AL/MC facility in White River Junction Vt.”
The ad further said “loan proceeds were also used to pay off minor cost overruns and (a) preferred equity partner.”
The $29 million Village loan is the third-biggest of 24 commercial financing deals that Columbia Pacific Advisors lists on its website.
Ciardelli, in an interview on Monday, declined to comment on Spragins’ email other than to say neither she nor Hathorn had ever spoken with Spragins in the two years that The Village has been involved with Columbia Pacific.
“Frankly, it sounded a bit off the cuff,” she said.
Messages left for Spragins were not returned.
Mike Thomas, senior asset manager for real estate lending strategy at Columbia Pacific Advisors, declined via email to comment about Spragins’ email to the Village resident other than to say “as far as the residents and community are concerned, everything is business as usual.”
Officially, at least, Columbia Pacific said it sees The Village as a savvy investment opportunity.
“We are buying what we believe to be a premier senior living community ahead of a significant and quickly approaching demographic trend of an aging U.S. population,” Columbia Pacific said in the news release.
But Ciardelli said that, as commercial real estate developers, “it was never the plan” to be the long-term operator of The Village, which is managed by Life Care Services, a Des Moines, Iowa-based manager of assisted living communities. Ciardelli said the contract with Life Care Services will continue and residents of The Village will not notice any changes in day-to-day operations or their interactions with staff.
Ciardelli credits the current on-site Village management team with navigating through a difficult period and emerging from the pandemic in positive shape. While occupancy at most assisted living communities fell during the pandemic, The Village “was up nearly every month,” she said.
Moreover, “we did not ever have an outbreak and no residents ever tested positive” for Covid-19, she said.
Columbia Pacific said that Nikki Fortier, who was promoted earlier this year to executive director and receives good marks from residents, will continue in her position.
Late Monday, Fortier sent an email to Village residents to inform them that “transition of ownership for The Village is scheduled to happen next week.”
“I want to personally assure you again that nothing here on the ground at The Village is changing. Same operations, same staff, same great place to live. I’m excited about the future here. It is looking bright!” Fortier wrote.
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