Berkadia Uses New Freddie Mac Option for $146M Brookdale Financing

Berkadia has successfully completed the first-ever Freddie Mac Seniors Housing Early Index Lock transaction in a recent portfolio refinance for 19 Brookdale (NYSE: BKD) properties. 

The company arranged $146 million in financing for the portfolio, making it the first to utilize the index lock option under Freddie Mac. 

The Freddie Mac option, which was made available recently, presents appeal in a rising rate environment allowing the borrower to lock the index up to 90 days before closing, Berkadia says. It does not lock the spread, however. 


“Ideally, this feature is better suited to a one-off transaction, but can be used for a portfolio, as was the case for this transaction,” says Berkadia Vice President Chris Fenton, who with Vice President Heidi Brunet of Berkadia’s Seniors Housing and Healthcare group, represented the financing.

Berkadia worked with Brookdale to arrange the seven-year fixed-rate loan, while will be used to refinance the 19 Brookdale properties. They are located in 10 states spanning Arizona, California, Colorado, Florida, Indiana, Kansas, Michigan, Pennsylvania, Texas and Washington. 

Terms of the loan include a 4.76% interest rate and 60% loan to value ratio with a 30-year amortization schedule. 


“This is the third large portfolio transaction Berkadia has closed on behalf of Brookdale in the past year,” Fenton said. “As a long-term partner to Brookdale, we seek to identify the best possible financing solutions to help facilitate their long-term growth plans. Our experience in the seniors housing sector and our strong relationship with Freddie Mac were both essential to closing this unique transaction.”

The properties comprise 1,170 total units including 770 for assisted living, 205 for memory care and 195 for independent living. The units are roughly 90% occupied on average.

Written by Elizabeth Ecker 

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