Senior Housing Finance Activity: Welltower, CBRE

Welltower Completes $700 Million Senior Unsecured Note Offering

Toledo, Ohio-based Welltower Inc. (NYSE: HCN) has successfully completed its offering of $700 million in aggregate principal amount of 4.25% senior unsecured notes due April 1, 2026. The notes were priced at 99.227% of their face amount to yield 4.345%.

“This transaction demonstrates Welltower’s disciplined approach to balance sheet management and capital allocation by maintaining a long-duration, predominately fixed-rate debt capital structure,” Scott Estes, Welltower’s chief financial officer, said in a prepared statement. “As a result of strong investor demand and growing market appreciation of our asset quality and strategy, we addressed our near-term capital needs while significantly enhancing our financial flexibility and liquidity.”


The real estate investment trust (REIT) plans to use the net proceeds from this offering to repay advances under its main unsecured credit facility and for general corporate purposes, such as investing in health care and seniors housing properties. Pending such use, the net proceeds may be invested in investment grade, short-term, interest-bearing securities, certificates of deposit or indirect or guaranteed obligations of the United States.

Wells Fargo Securities, LLC, UBS Securities LLC, Credit Agricole Securities (USA) Inc., J.P. Morgan Securities LLC and KeyBanc Capital Markets Inc. served as joint book-running managers for the offering.

CBRE Arranges $30.2 Million Acquisition Financing for DiNapoli Capital Partners


Andrew Behrens, vice chairman of CBRE Multifamily Institutional Group (CBRE) and Aron Will, executive vice president of CBRE National Senior Housing, have arranged acquisition financing on behalf of DiNapoli Capital Partners (DCP) for the acquisition of Terraces of Roseville, a 198-unit independent living, assisted living and memory care community located in Roseville, California.

Specifically, CBRE Multifamily Capital originated a $30.2 million, non-recourse, 10 year Structured ARM with five years of interest through its Fannie Mae DUS multifamily loan origination program.

DCP intends to reposition Terraces of Roseville within the market by spending a substantial amount of capex in order to bring the property up to commensurate levels of the competitive market set and to satisfy resident expectations within the marketplace. The property will continue to be managed by Westmont Living, Inc., which has managed the property since 2009.

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DCP is a privately held real estate investment firm engaged in the development, acquisition and management of hotels, multifamily, senior housing and office properties. California-based Westmont currently operates 11 senior housing properties throughout Oregon and California.

Cain Brothers Acts as Investment Banking Advisor for Issuance of $40 Million on Behalf of The Evangelical Lutheran Good Samaritan Society

Cain Brothers acted as the sole investment banking advisor for the issuance of $40 million taxable bank direct purchase bonds on behalf of The Evangelical Lutheran Good Samaritan Society, the nation’s largest not-for-profit provider of senior care and services based in Sioux Falls, South Dakota.

The Society operates skilled nursing facilities, residential housing for seniors, home- and community-based health services and affordable housing projects in more than 230 locations across the United States. Proceeds from the financing were used to pay down a line of credit that was initially drawn upon to finance the purchase of a home health agency that provides home care services in Arizona and New Mexico.

Cain Brothers solicited proposals from qualified banks for a direct purchase financing structure and helped the Society to evaluate the bank financing proposals, negotiate the details of the bank debt and coordinate the documentation and closing of the transaction. Cain Brothers structured the Series 2016 Bonds as a direct bank purchase and was able to secure longer term variable rate taxable bonds on behalf of the Society. The bank loan ultimately aided the Society in acquiring a home health agency, as well as was able to further diversify their revenue source by more than doubling the Society’s home health business.

RED Mortgage Capital Secures Financing for SNF in Pennsylvania

Columbus, Ohio-based RED Mortgage Capital, the mortgage banking arm of RED Capital Group, LLC, closed an FHA 232/223(f) insured loan for the refinancing of Sunnyview Nursing and Rehab Center, a 220-bed skilled nursing facility in Butler, Pennsylvania. The loan resulted in non-recourse, long-term, low interest rate financing for the facility and includes a flexible pre-payment schedule.

The facility was previously owned by Butler County. Investment360 acquired the facility in 2014 after it was chosen by the county through a competitive bidding process.

Under its new ownership, patient care has improved along with quality mix, census and financial performance. The FHA-insured financing refinanced the first mortgage acquisition debt, as well as certain subordinate financing to maximize the permanent debt.

Ziegler Closes $38.225 Million Willow Valley Communities Financing

Chicago-based specialty investment bank Ziegler successfully closed the $38,225,000 tax-exempt, fixed-rate Series 2016 Bond issue for Willow Valley Communities, which owns and operates three retirement communities on two campuses in the County of Lancaster, Pennsylvania: Willow Valley Manor, Willow Valley Lakes Manor and Willow Valley Manor North.

The buildings, land and associated facilities at Willow Valley Manor, Willow Valley Lakes Manor and Willow Valley Manor North are expected to be financed with the proceeds of the 2016 bonds.

The Series 2016 Bonds are tax-exempt, fixed-rate bonds rated ‘A’ with a stable outlook by Fitch Ratings and were offered without the utilization of a debt service reserve fund nor a springing debt service reserve fund. The bonds are structured to provide level aggregate yearly debt service through final maturity in 2039. The arbitrage yield and yield to maturity on the $38,225,000 issue are 2.885% and 3.367%, respectively.

Willow Valley Communities is expected to use the proceeds from the sale of the Series 2016 Bonds to refund part of the Lancaster Industrial Development Authority Adjustable Rate Demand Revenue Bonds, Series A of 2009 (Willow Valley Retirement Communities Project) consisting of $9,585,000 of the outstanding $17,925,000 principal amount, and a portion of the Lancaster Industrial Development Authority Adjustable Rate Demand Revenue Bonds, Series B of 2009 (Willow Valley Retirement Communities Project) consisting of $9,585,000 of the outstanding $17,925,000 principal amount finance and /or reimburse the cost of The Vistas at Providence Park project; and pay costs of issuance of the 2016 bonds.

Part of the proceeds from the 2016 bonds will also be utilized for the building, equipping and furnishing of The Vistas at Providence Park. The Vistas are expected to be a five-story, 53-unit residential apartment building located on the Manor Campus. The general contractor and architect for the project are CCS Building Group and RLPS Architects, respectively.

“Fitch truly saw the value of the organization’s strong management team and commitment to providing unsurpassed amenities and care,” Amy Castleberry, senior vice president in Ziegler’s Senior Living Finance practice, said in a press release. “We were able to take advantage of this low fixed-rate market to reduce the organization’s variable interest rate exposure in addition to funding the expansion project.”

Willow Valley Communities also operates a lifecare at home membership-based program in Lancaster County called SmartLife VIA Willow Valley. Willow Valley Communities is the sole Owner of Connections at Home VIA Willow Valley, LLC, a home care agency that offers services including companion and homemaking services, wellness visits and personal assistance.

Written by Mary Kate Nelson

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