Senior Housing Finance Activity: Ziegler, CBRE

Ziegler Closes $34.5M Financing for Conn. CCRC

Ziegler, a specialty investment bank, closed a $34,510,000 tax-exempt, fixed-rate Series 2015A Church Home of Hartford’s Series 2015A Bonds.

Church Home of Hartford d/b/a Seabury (the Obligor), a new client to Ziegler, is a Connecticut not-for-profit corporation formed in 1876. 

In 1992, the Obligor established Seabury, an interfaith, active Type-A continuing care retirement  community in Bloomfield, Conn. The community is located on an approximately 68-acre site and currently consists of 193 independent living units, which include 34 independent living cottages and five villas, and 154 independent living apartments, 49 assisted living units, 58 memory care units and 60 skilled nursing beds.

A subsidiary of the Obligor, Seabury Memory Care Centers, Inc. (SMCCI) currently owns and operates the 58 memory care units within the Community stated above. Pursuant to an Agreement and Plan of Merger between the Obligor and SMCCI, upon filing of a certificate of merger (occurring upon issuance of the Series 2015A Bonds), SMCCI will merge into the Obligor with the Obligor as the surviving entity.

Proceeds of the Series 2015A Bonds will be used to currently refund two outstanding bank loans, terminate an existing interest rate swap, provide reimbursement for previous capital expenditures, fund the first phase of a multi-phase repositioning strategy, fund a debt service reserve fund and pay a portion of the costs of issuance for the bonds, Ziegler says in a statement. Fitch Ratings assigned a rating of BB (stable) to the Series 2015A Bonds.

The first phase of the repositioning will include an extensive renovation and expansion to the main building on the Seabury campus including a new front entrance and expanded lobby, renovated reception and security areas, administrative/marketing suite renovations, a new human resources suite, new accounting suite, renovated lounge, kitchen renovation and expansion of existing private dining room, and additional parking among other campus improvements. 

Greenbrier Development, LLC is serving as development consultant.

A subsequent financing may occur late in 2015 to fund additional phases of development consisting of approximately 65 new independent living units, a new health care building expansion with additional skilled nursing beds and assisted living units, a chapel, and a new space for Seabury’s community outreach service, as well as other renovations, Ziegler says.

The potential subsequent financing will total approximately $72 million with temporary debt of $23 million and permanent debt of $49 million. Amortization of the future permanent debt is anticipated to be deferred to account for the amortization of the Series 2015A Bonds in order to approximate level aggregate annual debt service.

“We look forward to the completion of a financing for the later stages of the expansion by the end of 2015,” says Rich Scanlon, managing director in Ziegler’s senior living practice.

NorthMarq Capital Arranges $10M Acquisition Financing for Planned Calif. Memory Care Facility 

NorthMarq Capital arranged acquisition and rehab financing of $9.96 million for Monarch Cottages located in La Jolla, Calif. Aaron Beck, vice president of NorthMarq Capital’s San Diego based office, arranged the financing. 

The business plan calls for the conversion of a vacant medical office building into a class “A” memory care facility. The loan provides interest-only payments with a floating rate, and minimal recourse. NorthMarq arranged financing for the borrower through its relationship with a debt fund.

“The loan provides the necessary structure and funds for both acquisition and construction,” Beck says in a statement.

CBRE Arranges $27M Financing for Calif. Assisted Living, Memory Care Community 

CBRE Multifamily Capital originated a $22.62 million, 10 year fixed rate loan from Fannie Mae, for Westmont of Brentwood, a class “A”, 131 unit/142 beds assisted living (72%) and memory care (28%) community located in northeast Brentwood, Calif. 

Andrew Behrens, vice chairman of CBRE Multifamily Institutional Group (CBRE) and Aron Will, executive vice president of CBRE National Senior Housing, arranged the financing on behalf of TSM Investment Corp. (TSM) and Westmont Living (Westmont).

The property will continue to be managed by Westmont who has been operating it since early 2013.

“Since taking over operations at that time, Westmont has greatly improved the property’s operations and reputation in the market, along with converting a portion of traditional assisted living units into a memory care wing in 2014,” CBRE says in a statement, adding that California-based Westmont brings over 18 years of industry experience. “Westmont has specialized in turnarounds deals similar to the subject where operations/cash flow were not being maximized.”

Since 1982, California-based TSM has built and managed 12 medical related developments incorporating 558,695 total square feet all of which are all located in California.

CBRE Arranges $14M Acquisition Financing for Calif. Assisted Living, Memory Care Community 

CBRE Multifamily Institutional Group (CBRE) arranged financing on behalf of DiNapoli Capital Partners (DCP) for the acquisition of Alta Manor, an 86-unit assisted living/memory care community located in Roseville, Calif. (Sacramento MSA).

Andrew Behrens, vice chairman of CBRE and Aron Will, executive vice president of CBRE National Senior Housing secured a $14.48 million non-recourse floating rate bridge loan, which includes a 5 year term with 24 months interest only. The $14.48 million loan includes a $3.5 million earn out.

DCP will retain JEA Senior Living (JEA) as the third party manager. 

“DCP plans to reposition Alta Manor within the market changing the product mix and spending a substantial amount of capex which includes items such as improved signage and FF&E in order to meet resident expectations within the Roseville marketplace,” CBRE says in a statement. 

Founded in 1998, DCP is a privately held real estate investment firm engaged in the acquisition, development and management of hotels, multifamily, office and senior housing. To date, this transaction serves as DCP’s fourth senior housing acquisition. 

JEA is a privately owned and operated senior housing management and development company based in Vancouver, Wash.

CBRE Arranges $21M Acquisition Financing for Mass. CCRC

CBRE National Senior Housing arranged acquisition financing on behalf of a joint venture between Sentio Healthcare Properties, Inc. (Sentio) and Senior Living Residences (SLR) for Armbrook Village.

Armbrook Village is a “Class A”, 122 unit/141 bed rental continuing care retirement community located in Westfield, Mass. (Springfield MSA). 

CBRE secured a $21 million non-recourse floating rate bridge loan, which includes a five-year term with 24 months interest and an “all-in” interest rate today of approximately 2.35%. The loan was procured from a regional bank. Aron Will, executive vice president of CBRE National Senior Housing arranged the acquisition financing.

The property has been managed by SLR since opening in 2013 and has sustained a consistent lease up since inception. SLR will remain in the transaction as both the operator and a joint venture partner.

At closing, the property was mid-80’s percent occupied.

The acquisition marks the third asset owned in partnership with Sentio and SLR.   

CBRE Arranges $14.5M Acquisition Financing for Fla. Assisted Living, Memory Care Community 

CBRE National Senior Housing arranged acquisition financing on behalf of Capitol Seniors Housing (CSH) for Arbor Terrace at Citrus Park.

The property is a “Class A”, 92 unit/110 bed assisted living and memory care community located in Tampa, Fla., which just received its certificate of occupancy. 

CBRE secured a $14.5 million non-recourse floating rate bridge loan, which includes a five-year term with 30 months interest. The loan was procured from a regional bank. Aron Will, executive vice president of CBRE National Senior Housing, arranged the financing.

CSH is acquiring the property at C of O and is retaining Atlanta-based The Arbor Company to third-party manage the asset.

“The acquisition of the property represents the opportunity to purchase a completed, Class “A” assisted living/memory care community in an infill location within a strong Florida market,” CBRE says in a statement.

Berkeley Point Capital Facilitates $8.M Refinance Loan for Ore. Senior Care Community 

Berkeley Point Capital closed an $8.2 million FHA 232/223f loan for St. Anthony Village, a 127-unit independent living, assisted living and memory care community in Portland, Ore.  

“The FHA loan significantly reduced the borrower’s interest rate, which decreased by approximately 50%, and thus will materially enhance net cash flow going forward,” Berkeley Point Capital says in a statement.

The community is located approximately five miles from Portland’s business district and in close proximity to both Providence Medical Center and Portland Adventist Medical Center.  

“St. Anthony Village provides both a market rate and an affordable housing option for seniors in the area,” Berkeley Point Capital says.

The community is managed by Services for All Generations Enterprises (SAGE), which is an operating entity affiliated with 
the property. SAGE is a non-profit entity that also manages two other senior housing properties in Portland.  Father Michael 
Maslowsky oversees the subject community.  

“The community also benefits from its faith based orientation in the market,” Berkeley Point Capital says.

Doug Harper, director, led the Berkeley Point Capital team to structure the FHA loan.

“It was a great opportunity to work with Father Michael Maslowsky and his team to provide this important FHA loan that significantly lowered debt service for St. Anthony Village,” Harper says. “With the closing of this 35-year fixed rate FHA loan, St. Anthony Village is well positioned to be able to continue to provide compassionate care to its residents for years to come.”

Love Funding Secures $6M Loan for Md. Nursing Center Expansion 

Love Funding closed a $5.76 million loan for additions and upgrades to The Hermitage at St. John’s Creek and Solomons Nursing Center, a 133-bed skilled nursing and assisted living facility in Solomons, Md. 

Love Funding Senior Director Laura Saull-Smith of the Washington D.C. office obtained the loan through the U.S. Department of Housing and Urban Development’s Section 241(a) program, which allows for secondary financing for the purpose of upgrading furnishings and/or for complete renovations and additions in order to help meet demand in the local market. 

“The loan will allow the owner, Les Breckenridge, to expand the property and add a new wing that will include 12 private skilled nursing rooms and a new dinning room,” Love Funding says in a statement. “Additionally, 23 private assisted living rooms will be constructed.”

Saull-Smith also secured the $6,363,000 loan closed in December 2013 that allowed the borrower to make repairs to the property, generated debt-service savings, and extended the loan term.

Extending the loan’s term and amortization schedule allowed Love Funding to conservatively underwrite the new 241(a) loan. 

“This was an excellent outcome for our building,” says Les Breckenridge, owner of the mortgagor and management agent, Vintage Health Care, LLC.

Written by Cassandra Dowell