Situation
Green Castle Recovery Centers, LLC d/b/a Sanford Behavioral Health (“Sanford” or the “Company”) is the largest independently owned provider of behavioral health treatment services in Western Michigan, with operations in the greater Grand Rapids, Michigan region.

Originally founded in 2015 by David and Rae Green, Sanford is a family business that continues to be founder/owner-operated.

The Company began in a restored historic home in downtown Grand Rapids, Michigan as a 10-bed residential substance use disorder treatment center for women. The Greens had seen many Michiganders leaving the State in order to receive high-quality substance use disorder treatment and were motivated to try and fulfill this need close to home. Sanford then expanded by adding another home which served as a 20-bed residential treatment center for men.

As Sanford continued to expand, it also added outpatient programs to support its residential treatment as well as an outpatient eating disorder program.

Objective
Before the onset of the pandemic, the Greens looked to expand Sanford even further and began planning an 18-acre behavioral health campus in Marne, Michigan.

Located 12 minutes from downtown Grand Rapids, the new campus, once fully operational, will house 134 beds including detox, residential substance use disorder treatment, residential eating disorder treatment and residential psychiatric treatment, as well as several outpatient programs.

With the addition of the new campus, Sanford created Michigan’s first stand-alone residential eating disorder program.

To support the expansion of the business and development of additional programming, Sanford was seeking additional investors to provide growth capital.

Solution
Ultimately, capital was secured in the form of a combination of (i) Convertible Debt through a Regulation D offering, (ii) a Sale-leaseback on the Marne property with a publicly traded Real Estate Investment Trust, and (iii) a revolving loan.

Matrix provided capital markets advisory services to Sanford, including marketing the opportunity to a broad base of potential investors as well as a limited group of qualified investors for the Regulation D offering, navigating the process through a quickly evolving and tumultuous capital markets environment, advising on pricing and terms, streamlining the three-pronged solution, coordinating the various transaction counterparties, and ultimately achieving successful execution of the capital raise, positioning Sanford for future growth.