Projected cash flow for Phoenix House NY is primarily based on future income as promised in net deficit funding contracts, such as the OASAS commitments. When the newly independent chapter separated from national, it essentially became a “young” enterprise again. This decision impacted the nonprofit’s creditworthiness, because traditional banks typically rely on borrowers’ repayment track record to predict repayment performance on current loans.

A high interest rate on the existing outstanding loan on the LIC property was not sustainable. From a solely transactional perspective, selling the $31M treatment facility in LIC was a viable option. In reality, relocation meant discontinuity and potentially something far worse-the dismantling of a successful program with community buy-in.

1. ThinkForward served as financial advisor throughout the year-long process of securing advantageous bank financing for our client. We leveraged our extensive network of lenders and investors.
2. We also made a comprehensive case for creditworthiness using detailed projections, cash flow modeling, and explanation of the transaction set-up.
3. Senior decision-makers at the bank trusted ThinkForward to deliver on our promises, and as a result our client was offered a loan at 4%interest-a significant interest rate reduction considering the previous rate (9-10%).

Our client responded decisively to an evolving healthcare marketplace and to ongoing economic uncertainty. Relocating to a new facility, potentially in a new neighborhood, had felt inevitable. ThinkForward provided an alternative financing option, restructuring the debt to keep theLong Island community programming intact.

Phoenix House offers short-term and long-term residential, intensive outpatient, and general outpatient treatment to a diverse population of adults. In April 2019, the New York chapter became an independent organization to better serve the LIC and LI markets.