Recent Senior Housing & Care Finance Transactions: Lancaster Pollard, KeyBank, Beech Street (3/8/2012)

Cushman & Wakefield Sonnenblick Goldman Arranges $47.3 Million Financing for Georgia CCRC

Cushman & Wakefield Sonnenblick Goldman recently arranged a $47.3 million mortgage financing to refinance the existing indebtedness of Park Springs, a stabilized 474-unit continuing care retirement community located in Stone Mountain, Ga.

“This financing demonstrates how a successful CCRC can still attract very favorable capital from knowledgeable lenders and investors, despite the recent headwinds that have faced this specific area in the industry,” said Richard Swartz, co-head of the firm’s Senior Housing Capital Markets team.

Park Springs opened in 2004 and is located on a 54-acre campus next to Stone Mountain State Park. It has 398 independent living units and a 76-bed health center. It currently has a more than 90% occupancy rate.

Beech Street Capital Closes $5.5 Million Refinance for New Jersey SNF

Beech Street Capital, LLC announced on March 6 that it has provided a $5.5 million loan through the Department of Housing and Urban Development’s Section 223(a)(7) program to refinance Milford Manor Nursing & Rehabilitation Center, a 120-bed skilled nursing facility in West Milford, New Jersey.

The borrower had an existing HUD mortgage loan with just under 24 years remaining, and was looking to increase the loan term to 30 years—the original loan term amount. By increasing the loan term, says Beech Street, the firm was able to refinance the property with substantial debt service coverage savings in addition to increasing savings through a significantly reduced interest rate.

The increased cash flow will be used to help the facility maintain its marketability, offset any unforeseen changes in federal or state reimbursements, and protect the facility’s long-term viability.

“This refinance allowed the borrower to perform some necessary repairs while taking tremendous advantage of the current interest rate environment, which is currently at all-time historical lows,” said loan originator Joshua Rosen, executive vice president of Beech Street Capital.

Lancaster Pollard Arranges $13.2 Million Refinance for California ALF

Lancaster Pollard recently arranged a $13.2 million refinancing for a Vintage Senior Living facility, Vintage Newport, located in Newport, Calif. The assisted living facility has 140 private rooms and a secured Alzheimer’s care wing. Vintage Senior Living was looking to reduce its debt service by taking advantage of current low interest rates, and Lancaster Pollard facilitated the refinancing of a nine-year-old FHA Section 232/223(f) loan.

The timing of the loan application’s submission coincided with a scheduled 1% decrease in the prepayment penalty on the old loan, and the firm was also able to negotiate less restrictive prepayment penalties, giving the debt structure more flexibility down the road.

Vintage Newport will have annual debt service savings of $117,556, without extending the term of the existing loan. Mortgage proceeds also funded a replacement reserve deposit of $200,000, which has been earmarked for capital improvements.

KeyBank Provides $5.1 Million Refinance to Ohio Healthcare Center

KeyBank Real Estate Capital recently closed a $5.1 million HUD refinance for Lakewood Health Care Center, Inc., a seniors housing community located in Lakewood, Ohio. The financing was a 35-year fixed-rate loan for Ennis Court Health Care Center, and had a 35-year amortization. The senior living facility offers 32 units of assisted living and 50 units of skilled nursing care, and has been family-owned and operated for more than 20 years.

Contemporary Healthcare Provides $12.9 Million Construction Loan for Wisconsin AL/SNF

Contemporary Healthcare Senior Lien Fund I, LP in conjunction with Contemporary Healthcare Fund I, LP recently provided $12.95 million in combined senior and mezzanine financing for the construction of a Wisconsin assisted living and skilled nursing facility.

“The industry is in great need of not only operators who seek to meet the growing needs and demands of our seniors with modern facilities and programs, but the capital to pair with such a vision,” said Doug Korey, managing director of Contemporary. “Contemporary is committed to assisting operators realize their visions by providing creative capital structures.”