Senior Housing Finance Activity: Cambridge, MidCap Financial

Lancaster Pollard Provides $5M Acquisition Financing for N.C. AL, Dementia Care Facility 

Lancaster Pollard’s recently launched finance company provided a $5.3 million balance sheet loan to fund Meridian Senior Living’s acquisition of Lawyer’s Glen Retirement Living Center.

Lawyer’s Glen Retirement Living Center is an 82-bed licensed assisted living (AL) and dementia care facility located in Charlotte, N.C. Meridian, a top-10 AL provider that operates over 100 communities nationwide, sought to acquire Lawyer’s Glen and improve operations. 

Lancaster Pollard Finance Co. provided a direct bridge loan and commitment to closing in 11 days, meeting all deadlines and saving Meridian from possibly losing the opportunity to acquire the facility, Lancaster Pollard said in a statement.   

“We appreciate Meridian’s confidence in our abilities to turn what could have been a disappointment for the buyer and seller into a major win for all parties,” said Doug Korey, president of Lancaster Pollard Finance Co. “We look forward to continuing our relationship with Meridian.”

In addition to providing financing for the acquisition, the loan also provided for significant capital improvements to the property as well as a reserve for working capital, all of which will assist Meridian in the turnaround of the facility, said Charlie Trefzger, president of Meridian Senior Living.

MidCap Financial Refinances $18M for Fla. AL, Memory Care Facility

MidCap Financial, a specialty finance firm focused on the middle market in North America and Europe, recently closed an $18,250,000 term loan with Capital Health Group, LLC (CHG).

The loan, secured by a first mortgage on an existing 94-unit/124-bed assisted living/memory care facility in Fort Pierce, Fla., was structured with a $17,000,000 initial funding, $250,000 interest reserve, and $1,000,000 earnout.

The loan refinanced existing debt and provided a small dividend to the owners of the facility. The floating rate debt has a term of 60 months and is intended to serve as a bridge to the future sale of the facility or agency financing.

The facility is owned by CHG and managed by a related party management company, Compass Pointe Healthcare Systems. CHG is a privately held real estate company that was formed in 2006 to acquire and develop seniors housing communities. Compass Pointe is an affiliated management company that provides management services for all of the properties in CHG’s portfolio. 

MidCap Financial Refinances $50M for Wis., Mich. Healthcare Facilities 

MidCap Financial, a specialty finance firm focused on the middle market in North America and Europe, recently closed a $50,000,000 transaction with Rice Health Care Centers, Inc. The loan is secured by 22 seniors housing and skilled nursing facilities on 16 distinct campuses throughout Wisconsin, and one in Michigan.

At the time of the refinance Rice entered into a NNN-lease with KBWB Operations – Rice, LLC, a newly formed entity of Atrium Health and Senior Living, an existing MidCap Asset Based Lending and Real Estate Borrower.

Under the lease agreement, Atrium operates the facilities and has a purchase option it may exercise on or before December 31, 2016. In addition to the mortgage term loan for Rice, MidCap provided Atrium with over $8,000,000 of working capital financing secured by accounts receivable.

“Rice is a highly regarded provider of quality care and Atrium is a sophisticated New Jersey based operator expanding into the Midwest,” MidCap Financial said in a statement. “The transaction represents a great opportunity for the principals of Rice to step back from detailed operations while providing Atrium a unique and sizable expansion opportunity.”

Financing was arranged by Kevin Breslin of Atrium.

CBRE Capital Markets Arranges $22.5M Acquisition Financing for S.C., Fla. Senior Living Communities 

CBRE’s Senior Housing Debt & Structured Finance practice arranged acquisition financing on behalf of a joint venture between Care Investment Trust & Royal Senior Care for the Royal Senior Care Portfolio.

The Royal Senior Care Portfolio consists of five senior housing communities with a combination of independent living, assisted living and memory care totaling 282 units located in Gaffney, S.C.; Easley, S.C.; Port Royal, S.C.; Summerville, S.C.; and Tampa, Fla. 

CBRE secured a $22.5 million, five-year loan from a regional bank at 70% LTC which includes 36 months of interest and a $2 million earn out feature.

Aron Will, executive vice president of CBRE’s Senior Housing Debt & Structured Finance practice arranged the acquisition financing.

The portfolio will be cross-collateralized, cross-defaulted. The communities will be managed by Royal.

Care and Royal plan to enhance the resident experience by implementing an extensive capital improvement program and by adding programming at the communities to cater to higher acuity residents, CBRE said in a statement.   

Care is a real estate investment and finance company that invests in seniors housing real estate, and is a wholly-owned subsidiary of Tiptree Financial Inc. (NASDAQ: TIPT), a diversified holding company engaged through its consolidated subsidiaries in a number of businesses and is an active acquirer of new businesses.

Oak Grove Capital Closes $3.6M Refinancing for Iowa AL, Memory Care Facility 

Oak Grove Capital closed a $3,551,000 HUD FHA Section 232/223(a)(7) refinance transaction for Senior Suites of Urbandale, an assisted living and memory care community in Urbandale, Iowa.

Senior Suites of Urbandale has 63 units. 

Tony Washington, vice president of Oak Grove Capital, facilitated the transaction. 

Cambridge Realty Capital Arranges $17M Refinancing for Calif. Post Acute Care Center

Cambridge Realty Capital Companies arranged a $16,800,000 HUD Lean loan to refinance the New Vista Post Acute Care Center located in Los Angeles, Calif.

The fully-amortized, 26-year loan was arranged for the owner, a California limited liability company, using the HUD Section 232 pursuant to Section 223(f) funding program, said Jeffrey A. Davis, Cambridge chairman, in a statement.

Underwriting the transaction was Cambridge Realty Capital Ltd. of Illinois, the Cambridge business that specializes in underwriting FHA-insured HUD loans.  

New Vista Post Acute Care Center is a 116-bed skilled care facility, providing medical and rehabilitation programs.  

MidCap Financial Closes $31M Refinancing for Calif. SNFs

MidCap Financial, a specialty finance firm focused on the middle market in North America and Europe, closed a $31,000,000 transaction with LifeHouse Health Services, LLC.

The loan refinanced out existing first mortgage and working capital loans secured by a first mortgage across five properties. Additionally, the loan provided acquisition financing for LifeHouse to exercise its purchase option on one of the facilities.

The floating rate debt has a term of three years and is intended to serve as a bridge to HUD to refinance all five facilities.

“This was a highly structured transaction involving multiple facilities with varying competitive positions in different markets,” MidCap Financial said in a statement.

The five facilities are located in the greater San Francisco and Los Angeles areas, contain 768 licensed skilled nursing beds, and are operated by LifeHouse Management Services, LLC. LifeHouse, headquartered in Culver City, Calif., is an established owner and operator of nine skilled nursing facilities in California.  

MidCap Financial Provides $13M Acquisition Financing for 2 Mich. SNFs

MidCap Financial, a specialty finance firm focused on the middle market in North America and Europe, closed a transaction with Advantage Management Group (AMG) to acquire two skilled nursing facilities in the Detroit, Mich. area.

MidCap Financial provided a $12,950,000 first mortgage floating rate loan with a term of up to four years.

“The loan not only financed the acquisition, but also will enable the borrower to complete capital improvements and reposition the properties within their respective markets,” MidCap Financial said in a statement.

The 151-bed and 169-bed facilities were originally built in the 1960s and have been owned and operated by a non-profit organization.

“AMG saw great upside in the cash flow by layering its management expertise with respect to both marketing and cost control measures,” MidCap Financial said.

AMG currently owns and operates seven skilled nursing facilities in the Detroit area, inclusive of the two recently acquired properties.

MidCap Financial has had a relationship with AMG for several years, providing both acquisition and working capital financing. 

Financing was arranged by Chris Urban of Ambrose Capital Group.

Written by Cassandra Dowell