Senior Housing Finance Activity: RED Capital, Ziegler and More

AHEPA National Housing Corporation Receives HUD Grants for Assist Living Conversion

AHEPA National Housing Corporation has received $2.38 million in grants assistance to fund an assisted living conversion program for its Indianapolis-based AHEPA 232 Apartments. The recipient is one of only six grants awarded by the Department of Housing and Urban Development under its assist living conversion program, which supports transformation of housing into senior living units that foster an ability for residents to age in place. 

Under the grant funding, AHEPA 232 will convert 24 of its 74 units to service-enriched senior housing. 


“This is a significant milestone to be added to our ANHC history of senior housing development,” said AHEPA National Housing Corporation President Angelo Kostarides. 

The Section 202 affordable senior property opened in 1985 and is managed by AHEPA Management Company, which will oversee the new services. The conversion is expected to be completed in 2015. 

Ziegler Secures $53 Million Financing for Texas Senior Living Non-Profit


Specialty investment bank Ziegler has closed $53 million in non rated, fixed-rate Series 2014 bond issue for Georgetown, Texas-based Wesleyan Homes Inc. Wesleyan Homes, a not-for-profit corporation, operates independent living, assisted living, skilled nursing, memory care and hospice care in Georgetown, about 18 miles from Austin.

The new bond financing will be used to finance construction and development of 117 independent living apartments, six independent living duplexes, and 22 assisted living apartments; as well as to refinance Series 2009 bonds, to fund capitalized interest over 21 months, fund a debt service reserve fund; and pay for associated costs of issuance. 

“We were pleased to work with the Management and Board of Wesleyan Homes as the Series 2014 Bonds allow Wesleyan Homes to continue its organizational growth and solidify its position as the leading provider of senior living services in its market area,” said Brandon Powell, Director in Ziegler’s senior living practice. “We see this financing as the first step in a multi-year relationship in assisting Wesleyan Homes meet its strategic and financing objectives.”

Ziegler closes $23.3 Million Financing for Friendship Village of Dublin, Ohio

Ziegler has announced the successful closing of a $23.3 fixed-rate, Fitch rated “A-“ Series 2014 Bond issue for Friendship Village of Dublin, an Ohio not-for-profit corporation that provides housing, health care, home health and other services to the elderly.  

Today, the community maintains a 366-unit Type A (Lifecare) continuing care retirement community (CCRC) totaling 450,000 square feet on a 23-acre campus. The units comprise 244 independent living apartments, 16 independent living villas, 46 assisted living studio apartments (13 designed as memory care), and a 60-bed skilled nursing facility. The operator has earned national accreditation from CARF-CCAC and its skilled nursing facility earned a five-star rating from CMS/Medicare. The property is managed by Life Care Services.

The new financing will be used to reimburse the village for costs of construction of 12 villas over the last two years, to fund capital expenditures including four villas, and to pay a portion of issuance costs in connection with the Series 2014 bonds. The bonds did not fund a debt service reserve fund; rather FVD will fund it if its days cash on hand falls below 600 days. 

The transaction marks the first time Ziegler has underwritten fixed-rate senior living bonds without a DSRF funded at closing, Ziegler says.  

“Ziegler leveraged FVD’s exceptional liquidity (pro forma DCOH over 1,200 days) to structure a “springing” debt service reserve fund whereby FVD will fund its DSRF if its DCOH falls below 600 days and is subsequently released if DCOH exceeds 900 days,” the company said. 

As a result of the structure, FVD reduced the par amount of the Series 2014 Bonds by approximately 8%, or $1.9 million, which resulted in reducing the principal and interest requirements by almost $4 million over the life of the issue.

“Ziegler has had a long partnership with Friendship Village of Dublin that we are very proud of,” said Tom Meyers, managing director in Ziegler’s senior living practice. “This latest financing represents an opportunity to reposition 70% of its capital structure by capturing near all-time low fixed interest rates at an average of 4.10% for the next 30 years. This will provide Friendship Village of Dublin with a very stable capital base as they continue to pursue various projects included in their Master Plan over the next five years.”

RED Mortgage Capital Originates $1.8 Million FHA 223 Loan for National Church Residences

RED Mortgage Capital has originated an FHA 223(f) loan for National Church Residences for Walnut Creek Village in Baltimore, Ohio. The loan provided renovations as well as amenities toward aging in place for the community’s residents. Walnut Creek Village is a 40-unit Project-Based Section 8 rental assistance property catering to low income seniors and handicapped residents. 

In conjunction with the refinance, the owner also closed on a $3.284M Service Enriched Housing (SEH) Grant, awarded by the HUD Assisted Living Conversion Program. The grant funds will be used toward renovations including enhanced services and amenities such as Energy Star appliances and lighting. 

“We have worked with National Church Residences on many other projects structuring various financing packages to accommodate the property needs,” said Tracy W. Peters, Senior Managing Director at RED. “This is just another example of how we were able to work with HUD and National Church Residences to accomplish the renovation goals. RED was pleased to be part of structuring this transaction on a quality property that will be there to serve seniors in a comfortable and well-designed setting.”

RED Captal Partners Completes $13.5 Million Construction Loan for Avanti Senior Living

RED Capital Partners, the debt and equity banking arm of RED Capital Group, has completed a $13.5 million balance sheet construction loan to an affiliate of Avanti Senior Living. 

Avanti, a new Texas-based operator, will use the financing toward the construction of Avanti on Towne Lake, a 90-unit luxury assist living and memory care community in Cypress, Texas, a Houston suburb. 

The community will include 50 assisted living units and 40 memory care units. Avanti has partnered with an affiliate of Iron Point Partners to develop a portfolio of Class A senior living communities throughout Texas and the southeastern United States. 

The new community will feature several new technologies such as special lighting designed to mimic natural daylight, EHRs, RFID door locks, point-of-care devices for staff and extra monitoring for memory care residents.

“Avanti’s communities will be among the most technologically advanced in the country,” Kathryn Burton Gray, Senior Managing Director for RED said. “The service and care will be unparalleled. RED is honored to be financing their first project.”

Largo Financing Spans Senior Housing Construction and Finance

Under a larger $44.9 million financing for four multifamily properties, Phillips arranged $18.5 million for the construction of a senior living facility in Clarence, New York, near Buffalo. It will consist of a 3-story building comprising 111 units. Phillips secured the construction loan with a 5-year permanent term and 25-year amortization for the borrower.

The Largo Group of Companies also arranged $13.55 million in financing for two senior housing communities located in Hamburg and Cheektowaga; arranged by John Fletcher, account executive for Largo. The first property, a 112-unit senior housing complex comprising 14 buildings with two-bedroom/one-bathroom units constructed throughout.

The second property is a 104-unit senior housing apartment complex in Cheektowaga, which includes 13 buildings with 8 units each and a 5,000 square foot community building. Fletcher secured a 10-year fixed-rate loan with 30-year amortization for both properties.

MDA Approves $15 Million Bond Issue for Independent Living Facility

The McClellan Development Authority has approved a $15 million bond issuance for the construction of an independent living facility for retirees based at the former Army fort, Base McClellan, according to a report by the Anniston Star, based in Anniston, Alabama.

The McClellan Development Authority approved the issuance during its meeting on behalf of Georgia-based developer, Diversified Real Estate Services, according to the report. The firm, which announced the independent living facility project in January, could start construction early next year, MDA officials said during a recent meeting.

Diversified is now seeking a bank to provide the bonds, Robin Scott, executive director of the MDA, told the publication. 

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