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Erickson Living community receives ‘A’ rating from Fitch

Created date

November 22nd, 2011

Fitch Ratings, a bonds rating agency that provides information to current and potential purchasers of publicly traded bonds, recently upgraded its rating of Greenspring, an Erickson Living community in Springfield, Va., from BBB+ to A in its 2011 annual review.

Number crunching

According to the review, The upgrade is supported by Greenspring s consistently high occupancy levels across all levels of care, excellent cash flow (which has supported liquidity growth and robust debt service coverage), and favorable service area. Other factors supporting the elevated rating include the strength of the community s operations as well as Greenspring management initiatives such as apartment home upgrades and renovations. The stable rating outlook provided by Fitch also indicates the assumption that Greenspring will maintain its A rating long-term, as well as its current occupancy and performance levels. Greenspring takes a great deal of satisfaction from the recent Fitch Ratings upgrade. We are particularly pleased with the two-grade increase from BBB+ to A, and the financial health it implies, says Greenspring Director of Finance Berwick Drews. This is also very positive for our residents, both current and future, and reflects the community s focus on continued financial strength during what has been a challenging market. One of the first things I liked about Greenspring was the business plan and the professionals who present it, says community member Elisabeth Burnett, who recently celebrated her first anniversary of living at Greenspring. As a visitor deciding on where to move, I was struck by the congeniality of the community members who opened their homes and related their satisfaction living here. I now know 100% why!

Industry leader

Perhaps no other factor is more important to Greenspring s strong operating performance as its high occupancy level across all levels of care. According to Jarad Smith, Greenspring s director of sales and marketing, Greenspring continues to lead the CCRC industry with an occupancy rate at the 99% level. In addition, the Fitch review notes that Greenspring s assisted living and skilled nursing occupancy rates also have been excellent, ranging from the mid- to high-90% range since 2007. Greenspring benefits from its location in economically favorable Fairfax County, which enjoys a diverse economic base, highly educated labor force, and high income levels. The county s unemployment rate in March 2011 was 4.5% less than half of national unemployment figures. Further supporting the high occupancy has been Greenspring s use of an outside real estate agent in assisting incoming residents in the sale of their homes, notes Fitch. This has proven to be very effective, as the agent handled $16 million in sales for incoming residents in 2010. Greenspring also has a strong priority list, which has almost 1,500 depositors. By paying a $1,000 deposit, those on the priority list have the right of first refusal on the apartment home of their choice when it becomes available.

The best is yet to come

Fitch s optimistic outlook for Greenspring further reinforces the idea that moving to our community is an economically sound decision and will give our residents and future residents the comfort in knowing that their investment is stable and secure, says Smith. Community members evidently agree. Surveys conducted in 2010 indicate that among all 16 Erickson Living communities, Greenspring has the highest overall resident satisfaction. Additionally, 96.9% of resident respondents say they would recommend Greenspring to family and friends. If you want to remove the stress from your life, then move to Greenspring, says Diane Bayne. Moving here has been a gift of both time and energy.