Senior Housing Finance Activity: HFF, HCP, Oak Grove Capital

Healthcare Loan Volume Up 19% in Q3

Although commercial and multifamily mortgage origination volumes were down 7% in the third quarter of 2012 compared to the same period one year ago, the healthcare property loan volume grew 19%, according to the Mortgage Bankers Association’s Quarterly Survey. 

However, compared to the second quarter, healthcare property loans went down 25%. 


Year to date, originations for healthcare properties are up 33%—the most of any loan type in the commercial and multifamily sector. View the full report

HFF Arranges $56 million Financing for Senior Housing Portfolio in Oregon

HFF recently arranged $56 million in financing for a four-property senior housing portfolio with 419 units located near Portland, Ore. The financing firm, owned by HFF, Inc. (NYSE:HF) worked on behalf of Harrison Street Real Estate Capital, LLC and The Springs Living to secure the five-year floating-rate loan.  Loan proceeds were used to acquire, reposition and renovate the portfolio.


The four-property portfolio is 86% occupied overall and contains a diverse mix of independent living, assisted living and memory care. The HFF team representing the borrower was led by managing directors Stephen Skok and Timothy Joyce.

HCP Prices $800 Million of Senior Unsecured Notes

HCP (NYSE:HCP) priced an offering of $800 million of 2.625% senior unsecured notes, due Feb. 2020. This offering size was increased in response to demand, notes the real estate investment trust. The price to the investors was 99.729% of the principal amount of the notes for an effective yield of 2.667%. 

The net proceeds of the offering will amount o approximately $791 million, which will be used to repay $600 million currently outstanding on its bank line of credit. These borrowings were used to fund part of the purchase price for HCP’s acquisition of 133 senior housing communities from a joint venture between Emeritus Corporation (NYSE:ESC) and Blackstone Real Estate Partners VI, an affiliate of Blackstone Group. The proceeds will also be used for general corporate purposes, including the repayment of $150 million of 5.625% senior unsecured notes due Feb. 2013, and the funding of future acquisitions or investments. 

HCP expects the offering to close on Nov. 19, 2012. 

Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. LLC and UBS Securities LLC acted as joint book-running managers for the offering. 

Oak Grove Closes $17.5 Million Loan for Calif. Senior Housing Community

Oak Grove Capital recently closed a $17.5 million Freddie Mac loan for Aegis of Moraga, a senior living community in Moraga, Calif. 

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