OREANDA-NEWS. March 30, 2015. Fitch Ratings has placed the following 'BBB-' rated bonds , issued on behalf of Cathedral Village (CV) on Rating Watch Positive:

Philadelphia Authority for Industrial Development
--\\$9,165,000 revenue bonds, series 2013;
--\\$650,000 revenue bonds, series 2003A and 2003B.

SECURITY

The debt is secured by a security interest in gross receipts and a first lien on and security interest in the facilities.

KEY RATING DRIVERS

RATING WATCH POSITIVE: The Rating Watch Positive reflects the potential positive credit impact to CV resulting from its pending affiliation with Presbyterian Senior Living, the parent company of Presbyterian Homes Obligated Group (PHOG, rated 'BBB+' with a Stable Outlook by Fitch). The two entities have signed an affiliation agreement, under which Cathedral Village will become one of PSL's subsidiary corporations.

RATING SENSITIVITIES

COMPLETION OF PENDING TRANSACTION: Resolution of the Rating Watch will be tied to the closing of the transaction, which would result in a substitution of security on CV's outstanding bonds for a parity obligation under PHOG's master trust indenture. A request for bondholder consent for this change has been posted to EMMA.

CREDIT PROFILE

Cathedral Village is a Type-A continuing care retirement community (CCRC) located in Philadelphia, PA. The community consists of 293 ILUs (50 of which are eligible to be utilized as assisted living) and 133 skilled nursing beds. In fiscal 2014, Cathedral Village had operating revenues of approximately \\$23.7 million.

Presbyterian Homes Obligated Group is comprised of 17 separate continuing care retirement communities/long term care facilities located throughout Pennsylvania and locations in Ohio and Delaware. In aggregate, PHOG operates 1,121 independent living units, 462 assisted living units and 1,088 skilled nursing beds. The organization operates a wide variety of facilities including entrance fee CCRCs, stand-alone skilled nursing and personal care facilities, and rental independent living units. PHOG generated total revenues of \\$172.8 million in fiscal 2014.

Additional information is available in Fitch's March 27 press release, Fitch Affirms Presbyterian Homes Obligated Group (PA) Revs at 'BBB+'; Outlook Stable', available at 'www.fitchratings.com' .

CONTINUING DISCLOSURE

Disclosure language requires annual audit within 120 days, quarterlies within 45 days, with balance sheet, income statement, cash flows, occupancy and annual budget. However, disclosure covenant requires that information be sent only to the Trustee, Underwriter, and Bondholders holding \\$1 million of more. CV discloses quarterly and annual audited financial results on EMMA.