Lenders Help Ventas Assume $837 Million of Atria Mortgage Debt to Close Acquisition

A group of lenders assisted Ventas (NYSE: VTR) in assuming $837 million in existing mortgage debt to close on its acquisition of Atria Senior Living Group.

Red Mortgage Capital, Berkadia Commercial Mortgage and PNC Bank, originated more than 120 commercial mortgage loans made to wholly owned subsidiaries of Atria, Inc., the fourth-largest operator of assisted living properties in the country.  The transaction involves 118 senior living communities across the country.

The loans were subsequently sold to Fannie Mae and Freddie Mac, with the lenders retaining the loan servicing. Under the terms of the transaction, Atria spun off its management company, which will continue to operate the properties.

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Ballard Spahr, represented the three lenders on structuring the transaction, where Ventas acquired all outstanding stock in Atria, for which it paid $1.35 billion in Ventas shares, $150 million in cash, and $1.6 billion in net debt.

“It’s a positive sign that deals of this size are re-emerging in the real estate market. This is the fourth loan assumption transaction that we have closed in the past six months involving a REIT acquisition in the seniors housing space,” said Mr. Hauser, who is based in Ballard Spahr’s Baltimore office. “We have seen a general uptick in commercial real estate activity, especially in the multifamily area. We recently closed substantial real estate deals in the Midwest and Mid-Atlantic regions and continue to work with clients on other acquisitions and financings throughout the country.”

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