The pandemic has left many senior living operators reeling and driven a wave of defaults in the $3.9 trillion municipal-bond market, according to a recent report from independent research firm Municipal Market Analytics.
The latest default came from the Tennessee-based Appalachian Christian Village project, a continuing care retirement community that became impaired in May when it reported a February draw on reserves for financial difficulties. The financing’s new trustee posted that the firm would not make its Aug. 15 payment.
Appalachian Christian’s default pushes the year-to-date default total to 52, affecting more than $5 billion of outstanding principal. Senior living borrowers — mostly from the assisted living sector — account for 23 of the 52 defaults, according to MMA. Twenty-three is also a full-year record for the sector, which since 2009 has seen at most 22 defaults between January and December, the firm said in a note by Matt Fabian, partner at MMA and Lisa Washburn, MMA’s chief credit officer and managing director.
