Grand View Hospital Series 2021 Bonds

3 Mar

Case studies

Grand View Hospital Series 2021 Bonds

Bond Sale Date: February 23, 2021

Closing Date: March 11, 2021

$285,000,000 Series 2021 Bonds


Grand View Hospital (”GVH”) sought to finance a $184 million inpatient pavilion, refinance $98 million of variable rate demand debt and terminate two interest rate swaps. The inpatient pavilion will provide an advanced platform for delivery of more specialized services including Level II trauma care. The project will enable GVH to significantly increase revenue and return to operating profitability.


  1. Recent GVH operating losses were amplified by the COVID-19 pandemic
  2. The project’s transformative nature, complexity and essential need took time to articulate
  3. The goal of greater flexibility led to a restated MTI with liberal covenants for a below investment grade credit


  1. Effective rating agency approach. Early on, Ponder advised GVH to obtain a credit evaluation from its rating service to assess the impact on its existing bond rating of borrowing approximately $200 million for this project.
  2. Independent feasibility study prepared by its auditor. This report provided rating analysts and investors a more complete picture of GVH’s service area and ability to pay the additional debt service.
  3. Refund variable rate debt and terminate swaps. Ponder developed a financing plan that funded the project, lowered existing annual debt service, and refinanced existing debt and interest rate swaps.
  4. More flexible terms: Ponder led the effort to develop a legal structure that discharged restrictive financial covenants to create greater flexibility for the organization going forward.
  5. Took advantage of favorable market conditions. Despite a “BB+” rating, GVH received strong investor demand to lock in low rates. Over $2.2 billion investor orders led to an “all-in” borrowing cost of 3.75%.

About Grand View Hospital: BB+ (S&P) with Stable Outlook

GVH is a Pennsylvania not-for-profit corporation that owns and operates a169-licensed bed acute care community hospital and several outpatient and urgent care centers at various locations throughout its suburban Philadelphia service area. In FY 2020, GVH and its affiliates generated $199 million in total operating revenues and maintained $265 million of cash and investments. GVH has strong strategic affiliations for specialty services with Penn Medicine, Children’s Hospital of Philadelphia and other nearby regional healthcare systems. Beginning in January 2021, GVH became the only hospital in its primary service area to offer Level II trauma care services (through a clinical partnership with Penn Medicine) which will significantly grow its patient volumes and revenues.

Pricing Results:

Grandview Series 2021 Pricing Results

Comparable Bond Sales:

Grandview Series 2021 Comparable Bond Sales