Senior Housing Finance Activity: RED Mortgage, Love Funding

RED Mortgage Provides $4.4M FHA Loan to Ore. AL Facility  

RED Mortgage Capital, LLC arranged a $4,405,200 FHA 232/223(f) mortgage loan for The Bridge, a retirement and assisted living community in Grants Pass, Ore.

The community has 63 assisted living units.  

RED Mortgage Provides $8.5M FHA Loan to Ohio AL/Memory Care Facility 

RED Mortgage Capital, LLC arranged a $8,475,000 FHA 232/223(f) mortgage loan for Kensington Place, an assisted living and memory care community in Columbus, Ohio.

Kensington Place has 125 units.

RED Mortgage Provides $18M FHA Loan to Wash. AL/Memory Care Facility 

RED Mortgage Capital, LLC arranged a $18,228,600 FHA 232/223(f) mortgage loan for North Creek, an assisted living and memory care community in Bothell, Wash.

North Creek has 142 units.

RED Mortgage Provides $10M Loan to Fla. AL Facilities 

RED Mortgage Capital, LLC arranged a $10,000,000 balance sheet bridge loan for Livewell Coral Plaza & Courtyard Plaza, senior housing communities located in Margate, Fla. and North Miami Beach, Fla. respectively. 

The financing was provided for 260 assisted living units.

Red Mortgage Provides $3.8M for Fla. AL/Memory Care Facility 

RED Mortgage Capital, LLC arranged a $3,856,250 balance sheet mezzanine debt for Discovery Village at Palm Beach Gardens, an assisted living and memory care community in Palm Beach Gardens, Fla.

Discovery Village at Palm Beach has 120 units.

Ziegler Closes $33M Financing for Ariz. CCRC

Ziegler, a specialty investment bank, recently closed non-rated, fixed-rate $32,800,000 Tax-Exempt Series 2014A and $260,000 Taxable Series 2014B Bonds for the Sierra Winds Life Care Community Project, a long-standing Ziegler client.  

Arizona Retirement Centers (ARC) is an Arizona not-for-profit corporation incorporated in 1984 for the purpose of providing housing, health care and financial security to satisfy the primary needs of elderly persons. ARC owns and operates Sierra Winds, a life care continuing care retirement community that provides residents with individual use of a private apartment, supportive services and amenities, and health care services if a resident is no longer capable of living independently.

Sierra Winds owns and operates a 310-unit Type A life care community on a 20-acre campus in Peoria, Arizona, northwest of downtown Phoenix. The community has six studio residences; 72 one-bedroom residences; 162 two-bedroom residences; and 70 skilled care beds, 18 of which are Medicare-certified.

Sierra Winds is currently managed by Life Care Services. Sierra Winds will use the proceeds of the sale of the Bonds and other available funds to currently refund $26,860,000 of outstanding Series 1999 Bonds, finance certain improvements to and rehabilitation of the community, fund a debt service reserve fund, and pay certain expenses incurred in connection with the issuance of the Bonds.    

The 2014 Bonds were structured to extend the existing final maturity from 2032 to 2040, creating capacity to fund nearly $6 million in new money without increasing annual debt service. An additional $900,000 of capital expenditure funds were generated through breakage of two non-transferable investment contracts related to the Series 1999 Bond funds.

Ziegler served as co-managing underwriter on the original Series 1988 financing to construct Sierra Winds, and as sole managing underwriter on the Series 1999 Bonds now being refunded.

“This transaction marks a 26-year relationship between Sierra Winds and Ziegler, spanning evolution of this community from a start-up to a mature campus,” said Mary Muñoz, managing director of Ziegler’s senior living practice, in a written statement.

Walker & Dunlop Refinances $9.9M for Calif. SNF

Walker & Dunlop closed a $9,912,000 loan for the refinance of Vista Healthcare Center, located in Vista, Calif.

The transaction was processed through HUD’s LEAN program and allowed the borrower, LifeHOUSE Health Services, to pay off existing intra-company debt and take advantage of an attractive long-term, sub 4% rate.

Vista Healthcare Center is a 187-bed skilled nursing facility that offers health services, rehabilitation and other comprehensive long-term care services to its residents. The community features a beauty shop, an arts and crafts activity room, multiple lounges, outdoor patios, and frequent live entertainment events.

Michael Vaughn, Bethesda-based senior vice president, led the Walker & Dunlop team that structured the 35-year fixed-rate loan using a cap rate reflective of the current vibrant California market.

The loan is somewhat unique in that it carries a one year lockout period with four years of lower than standard prepayment penalties, providing the borrower with significant prepayment flexibility, Walker & Dunlop said in a written statement.

“When we bought the property with a very short turnaround, we wanted to make sure that HUD permanent financing would be available,” said Rowan Farber, president and CEO of LifeHOUSE Health Services. “When the HUD loan was structured, [Walker & Dunlop] were able to meet our needs for flexibility in the near to medium term, while still obtaining an attractive 35 year rate.”

BancorpSouth Bank Secures $200,000 Grant for Miss. Low-Income Seniors Housing

BancorpSouth Bank, a member institution of the Federal Home Loan Bank of Dallas (FHLB Dallas), recently secured a $200,000 Affordable Housing Program (AHP) grant, allowing Sacred Heart Catholic Mission to make critical repairs on 25 homes, with the majority of those homes being in Camden and Canton, and a few in Madison, Miss.

BancorpSouth Bank is located in Jackson, Miss. 

“We make these grant dollars available to our member institutions so they can collaborate with key community partners to address affordable housing needs in their respective communities,” said Bre Chapman, senior vice president and chief administrative officer with FHLB Dallas, in a written statement. 

This is the fifth grant that Sacred Heart Catholic Mission has received from FHLB Dallas through BancorpSouth Bank. Previous grants have allowed the organization to repair 90 homes between 2009 and 2014.

Officials at Sacred Heart Catholic Mission say they are in the process of selecting qualified homeowners, and work is expected to begin in 2015.

“There is such great need in our community for this type of project, and we simply could not make an impact without the support of partners like BancorpSouth Bank and FHLB Dallas,” said Sister Donna Gunn, coordinator of the home improvement program for Sacred Heart Catholic Mission. “Without our help, many of these senior citizens would have no choice but to continue living in conditions that are unsafe, and/or not conducive with a physical disability.”

Capital One Refinances $7.3M for Detroit SNF

Capital One Multifamily Finance provided a $7.3 million fixed-rate, HUD 232/223(f) loan to refinance a 176-bed skilled nursing facility in Detroit.

Senior Vice President Joshua Rosen originated the transaction.  

Rosen leads Capital One’s agency healthcare lending from the company’s Chicago office. This is the second HUD-insured project that the borrowers, specialists in skilled nursing facilities, have closed with Capital One. 

The property consists of 90 one-, two-, and three-bed units, and the investors have undertaken a comprehensive renovation program since they acquired it in 2010 that has made the property more appealing for Medicare residents.

“We have an excellent working relationship with this valued client, with several completed deals and more in the works,” Rosen said in a written statement. “In addition, the 232/223 (f) loan program—with its extended maturities—is a great way for investors to lock in today’s historic rates well into mid-century. This loan has a 35-year term.”  

In addition, the 232/223 (f) program offers an attractive loan–to-value ratio, and eligible loans are nonrecourse and fully assumable, he said.  

Love Funding Closes $7M Acquisition Financing for Ark. SNF

Love Funding closed a $7.21 million loan to fund the acquisition of Walnut Grove Nursing and Rehabilitation Center, a 102-bed skilled nursing facility in Springdale, Ark. 

Love Funding Senior Director Laura Saull-Smith of the Washington D.C. office secured the loan through the U.S. Department of Housing and Urban Development’s 232/223(f) loan program. The program provides non-recourse financing for the purchase or refinance of existing assisted living, memory care and intermediate or skilled nursing facilities. 

The processing of the loan set a HUD record for 2014, taking only 111 days from the time the application entered the queue at HUD to loan closing, Love Funding said in a written statement. Saull-Smith has closed approximately $75 million in transactions for the borrowers over the past decade. 

Written by Cassandra Dowell