Although the property's liquidity position remains strong at 397 days cash on hand and 66% cash to debt at Sept. 30, 2002, Fitch says investment income dropped sharply in fiscal 2002 to $22,000 from $912,000 in the previous period.

"Due to Canterbury's small revenue base, the organization is vulnerable to negative pressures, which leads to significant fluctuations in financial performance," the Fitch analysis says. Fitch analysts Emily Wong and John E. Wells prepared the report.

The report says Canterbury has major expansion plans which probably will be funded by other bond issues. The facility has hired a financial consultant to try and improve the property's finances.

The type A continuing care retirement community has 129 independent living units, 10 assisted living units and 36 intermediate nursing care beds. Occupancy is in the high 90s.

Reduced investment returns "significantly affected" Canterbury's financial performance with a negative 18.4% excess margin and 0.4x debt service coverage in fiscal 2002. In fiscal 2001, Canterbury had a 2.2% excess margin and 2.4x debt service coverage.

Fitch says the property's financial strengths are strong tenant demand and "excellent" liquidity. Canterbury is only one of four licensed continuing care retirement communities in Georgia.