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Category: Lancaster Pollard

HealthLease Commits to Co-Investment Relationship with Mainstreet

HealthLease Properties Trust has invested $20 million in Mainstreet Development Fund II, L.P., which will be used to develop between 12 to 16 seniors housing and care facilities in the United States over the next year.

HealthLease’s investment will consist of $15 million of mezzanine financing, which is targeted to produce an annual return of 14% on funds invested by the REIT and $5 million of equity financing, which is targeted to produce an annual return of 25% on funds invested by the REIT.  Mainstreet Property Group, LLC, the General Partner and Manager of the Fund, committed the initial US$5 million of equity financing to the fund.  The fund is expected to have additional closings from other third party investors in the first quarter of 2014.

“Our relationship with Mainstreet has enabled us to significantly grow the REIT in a relatively short period of time with high-quality assets that attract leading seniors’ housing and care operators,” said Zeke Turner, Chairman and CEO of Mainstreet. “This fund will help us grow the pipeline of acquisitions, allow us to achieve scale and deliver long-term value to our unit holders.”  

Lancaster Pollard Assists Providence Life Services Refinancing

Lancaster Pollard recently arranged a $34.3 million refinancing for Providence Life Services, a nonprofit Illinois corporation offering a full range of senior care and services with 13 facilities in Michigan and Illinois. 

Providence had approximately $43 million in outstanding debt in its Obligated Group in the form of variable-rate, tax-exempt bonds held by multiple banks. Lancaster Pollard recommended refinancing with the FHA Section 232/223(f) program to allowing Providence to lower its debt service and extend the permanency of its debt by eliminating bank-related financing risks.

More than $31.5 million of Providence’s outstanding debt was able to be allocated to facilities eligible for FHA refinancing, and by doing so based on the appraised value of those facilities, Lancaster Pollard was able to ensure that both HUD and the existing banks were comfortable with the pro forma debt allocation. 

Due to the necessity of utilizing accounts receivable financing with the transaction, the firm also worked with one of the banks so it could remain as the accounts receivable lender for all the facilities. 

Ultimately, Lancaster Pollard closed four FHA-insured loans under a master lease structure without obligating the rest of the Providence Life Services organization, resulting in a total of $34.3 million of long-term, low fixed interest rate loans. The transaction replaces most of Providence’s variable-rate debt with long-term, fixed rate debt. 

AHFC Announces $33 Million of Funding for Affordable Alaskan Housing

Alaska Housing Finance Corporation (AHFC) has announced its 2014 Greater Opportunities for Affordable Living (GOAL) grants and tax credits, totaling $33.2 million and benefiting five communities across the state. The projects will develop or upgrade a total of 179 rental units for low-income and senior Alaskans; five of the projects will leverage the AHFC funding with $1.5 million provided by Rasmuson Foundation. 

Alaska’s GOAL program includes a combination of federal and state grants and federal tax credits to project sponsors who build or renovate affordable rental and supportive housing for low-income, senior families and those with disabilities. 

The seven projects awarded funding are located in five communities: Anchorage, Delta Junction, Haines, Juneau, and Ninlichik. Grant recipients for low-income senior projects are: Eklutna Estates II in Anchorage, which will add 34 new rental units for low-income seniors (Cook Inlet Housing Authority) and Ptarmigan Heights in Delta Junction, which will add six new rental units featuring solar energy for low-income seniors (Deltana Community Services Partnership).

GS Commercial Real Estate Finances Newcastle’s Holiday Acquisition

Newcastle Investment Corp. subsidiaries have entered into loan agreements with GS Commercial Real Estate LP to fund the acquisition of the 51-property Holiday portfolio for about $1.04 billion. 

The lender is providing a term loan in the original principal amount of nearly $316.9 million scheduled to mature in 2021 and secured by 25 facilities fee-owned or ground leased by Newcastle, along with a term loan for $362.5 million, scheduled to mature in 2024 and secured by 26 facilities owned by Newcastle. 

Certain other Newcastle subsidiaries have also entered into a $40 million mezzanine loan with the lender, scheduled to mature in 2021 and secured by a pledge of 100% of the equity interests in the Newcastle subsidiaries under the first mortgage loan; and a mezzanine loan for $1,000 (according to a Newcastle filing) scheduled to mature in 2024 and secured similarly to the first mezzanine loan. 

Newcastle guarantees the borrowers’ obligations under each of the loan documents. 

Skilled Healthcare Group Announces $67 Million MidCap Financing

Skilled Healthcare Group, Inc. (NYSE: SKH) has announced the closing of a financing with MidCap Financial consisting of a $62 million non-recourse (subject to customary carve outs) mortgage-backed term loan and a $5 million asset based revolving credit facility with an initial balance of $5 million.

The loans are secured by 10 skilled nursing facilities and have a term of three years and an interest rate based on LIBOR which is currently approximately 6.7%. The net loan proceeds of approximately $65 million have been used to pay down outstanding term debt in Skilled Healthcare Group’s senior secured credit facility, which has a maturity date of April 2016 and an interest rate based on LIBOR which is currently approximately 6.8%.

“These loans, along with the disposition of two skilled nursing facilities earlier this month, further strengthen our balance sheet and provide additional cushion under our leverage ratio, which is a metric under our senior secured credit facility comparing earnings to debt that we must maintain below an agreed level,” said Bob Fish, Chief Executive Officer of Skilled Healthcare Group, in a statement. “We closed $87 million in HUD-insured loans earlier this year, and we continue to believe that the HUD program offers attractive opportunities for longer-term financing at favorable interest rates. We anticipate that these new loans, and the ten skilled nursing facilities securing them, will transition well into HUD-insured loans in the future.” 

Omega Healthcare Investors Enters $200 Million Loan Facility

Omega Healthcare Investors (NYSE:OHI) has announced a new $200 million senior unsecured, deferred draw, term loan facility hat matures on Feb. 29, 2016. 

The term loan facility is being provided through a credit agreement with Bank of America, N.A., as the initial lender and administrative agent. 

So far, Omega hasn’t made any borrowings against the new term loan facility, and proceeds of any future borrowings can only be used to finance general corporate working capital, including repayment of existing indebtedness, asset acquisitions, acquiring or improving income producing healthcare facilities, and investments incidental or related to such purposes, and capital expenditures or other corporate purposes. 

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Capital One Bank Announces $115 Million in Financial Transactions

Capital One Bank recently announced it acted as a joint bookrunner for an $85 million, seven-year senior secured term loan to subsidiaries of Parkwood Properties, Inc. and a $30 million revolver loan to Palm Garden Healthcare Holdings, LLC. Parkwood Properties will use the term loan to refinance existing debt and to finance upgrades and renovations to long term care facilities collectively owned by Florida Convalescent Centers, Inc. and Springdale Health Centers, LLC. Palm Garden and its subsidiaries will use the revolver to fund ongoing working capital requirements of the skilled nursing and assisted living facilities they now operate through the transaction closing.

Florida Convalescent Centers, Inc. and Springdale Health Centers, LLC collectively own 14 skilled nursing facilities (SNFs) and one assisted living facility in Florida, with a total of 1,921 licensed and available beds. Florida Convalescent Centers and Palm Garden also will expand their banking relationship with Capital One Bank to include deposit and treasury management services.

NHI Prices Offering, Aims at Net Proceeds of $245M

National Health Investors, Inc. (NYSE:NHI) announced the pricing of its underwritten public offering of 4.5 million shares of its common stock at $57.00 per share for net proceeds of approximately $245.3 million after related expenses. Underwriters have also been granted a 30-day option to purchase up to an additional 675,000 shares. 

NHI plans to use the net proceeds from the offering to fund a portion of the purchase price of its pending acquisition of 25 independent living communities from an affiliate of Holiday Retirement for $491 million. If the pending acquisition is not completed, the REIT will use the proceeds for general corporate purposes, including other possible future acquisitions.

Wells Fargo Securities, BofA Merrill Lynch and BMO Capital Markets acted as joint book-running managers and KeyBanc Capital Markets, Stifel, JMP Securities, BB&T Capital Markets, Credit Agricole CIB, Raymond James, RBS Securities Inc. and SMBC Nikko acted as co-managers for the offering.

Newcastle Closes Common Stock Offering, Raises $304M

Newcastle Investment Corp. (NYSE:NCT) announced on Nov. 22 the sale of 57,950,952 shares of its common stock, with gross proceeds of approximately $304.2 million.

Newcastle intends to use the net proceeds from the offering to fund a portion of the purchase price for a portfolio of senior housing properties the company has agreed to acquire from Holiday Retirement affiliates for about $1 billion.

Ziegler Closes $50 Million Ohio Presbyterian Retirement Services Financing

Ziegler, a specialty investment bank, has successfully closed the $50.6 million fixed-rate Series 2013A Bond issue for Ohio Presbyterian Retirement Services, an Ohio 501(c)(3) corporation founded in 1922. OPRS, headquartered in Columbus , owns and operates 11 communities throughout the state of Ohio.

Nine of the 11 campuses are full-service continuing care retirement communities. The organization also offers home and community based services through its senior independence practice that assists more than 85,000 adults.

The $50,550,000 Series 2013A Bonds were issued in concurrence with the 2013B Bonds, which total $25 million resulting in an aggregate amount of $75.6 million for OPRS’ 2013 financing. The 2013A and 2013B Bonds are being issued to retire a loan from PNC in the outstanding principal amount of $11 million; pay or reimburse OPRS for the payment of certain costs of acquiring, constructing, installing and equipping various capital expenditures; establish a debt service reserve fund for the Series 2013A Bonds; and pay cost of issuance for the Series 2013A and 2013B Bonds.

“The bond markets have been challenging for several months and Ziegler had been anticipating these challenges continuing through Thanksgiving and December. We were able to successfully price OPRS’ 2013A Bonds in advance of heightened year-end bond supply and we were able to add a slice of attractively priced bank capital with the 2013Bs to allow for a great overall financing for our client,” said Tom Meyers, managing director in Ziegler’s senior living practice. “OPRS will use this capital to pursue several meaningful new money projects at its Westminster Thurber, Rockynol and Breckenridge Village campuses to further support its mission of serving Ohio’s seniors.”

Cambridge Arranges $13.5 Million in Loans for 3 Calif. ALFs

Cambridge Realty Capital Companies has arranged $13.5 million in loans to refinance three assisted living facilities owned by a California limited liability company.

The fully amortized loans were arranged for the owner using the HUD Section 232/223(f) program and were underwritten by Cambridge Realty Capital Ltd. of Illinois, the Cambridge business that specializes in underwriting FHA-insured HUD loans.

Coordinating the transaction for the company was Hymie Barber, National Originations Manager and Managing Director of Catalyst/Cambridge Healthcare Finance in Los Angeles, the company’s West Coast affiliate.

The facilities included in the transaction are Glen Park West Retirement Community, a 98-bed assisted living facility in Glendale, Calif., with a $5.2 million loan; Glen Park East Retirement Community, a 97-bed assisted living and memory care facility also in Glendale with a $4.4 million loan; and Laurel Canyon Retirement Community, a 68-bed assisted living facility in North Hollywood, Calif. with a $3.9 million loan. 

Lancaster Pollard Arranges Senior Living Transactions in 5 States

Samaritan Village

Lancaster Pollard recently helped Samaritan Village refinance $23.3 million to convert a portion of their independent living units into assisted living units to meet resident demand. Samaritan Village is a long-term care community located in Hughson, Calif. and operated by Hughson Samaritan Village.

Lancaster Pollard worked with HUD to appraise the facility at levels above historical performance. In addition, the firm negotiated a discounted payoff with existing bond holders and obtained a letter of credit with a local bank that covered the debt service reserve cash requirement. The $23.3 million loan is insured by the FHA Sec. 232/223(f) program and will allow Samaritan to rid itself of the onerous covenants imposed by the old indebtedness and benefit from approximately $560,000 in annual debt service savings. In addition, the refinance will fund $580,000 in repairs, the majority of which facilitated the unit conversion. 

Park Place Senior Living

Lancaster Pollard recently assisted Leo Brown Group, LLC, with the refinance of Park Place Senior Living, a long-term care community located in Fort Wayne, Ind. The firm financed the original construction of Park Place in 2009 using the FHA Sec. 232 program. Due to the drop in interest rates since 2009, ownership sought to refinance its existing HUD debt to lower its interest rate and achieve debt service savings.

The firm was able to structure a $14.2 million loan insured by the FHA Sec. 232/223(a)(7) program with a competitive fixed interest rate that will provide significant debt service savings for the borrower. 

Claremont Care Center 

Lancaster Pollard recently refinanced a 118-bed skilled nursing facility, Claremont Care Center of Point Pleasant. N.J., for Hoosier Care, Inc., an Indiana nonprofit organization. The firm recommended using the FHA Sec. 232/223(a)(7) program and was able to reduce the interest rate on the property’s existing FHA-insured mortgage by nearly 1.5 percentage points, resulting in combined annual savings of more than $94,715 for the owner. In addition, the firm was able to extend the maturity to 30 years. 

Parkhaven Retirement and Assisted Living Community

Lancaster Pollard was engaged to assist in financing the acquisition of Parkhaven Retirement and Assisted Living Community by Parkhaven Investors, LLC, the operator/minority partner along with other local investors. Parkhaven, located in Manhattan, Mont., offers eight units of independent living and 36 units of licensed assisted living to residents of this bedroom community of Bozeman.

The firm recommended using the HUD Sec. 232/223(f) program for its low fixed-rate, higher loan-to-value and non-recourse features. The new long-term debt structure eliminated the new owners’ personal guarantees as well as funded over $400,000 in replacement reserves from the mortgage’s proceeds.

Resthave Home of Whitesound County

Lancaster Pollard assisted Resthave Home of Whiteside County, located in Morrison, Ill., with financing a $14.2 million expansion and renovation. The firm advised on the structuring of the financing, which combined USDA funds for permanent funding and a construction loan for a portion of the construction funding. It also underwrote $7 million of tax-exempt, bank-qualified, investment-grade-rated bond anticipation notes (BANs) for a two-year term, which were used to partially fund construction.

Resthave Home was able to fund its expansion and renovation with a blended interest rate of 3.30% for construction financing and 4.43% for permanent financing. The cost of capital includes a mix of 60% fixed rate and 40% variable rate capital. The term and amortization of the loan is 40 years. The larger, updated facility will feature additional parking, a large chapel and an open-air courtyard. Steve

Cain Brothers Reworks Front Porch Communities’ Capital Structure

Cain Brothers worked closely with Front Porch Communities and Services Senior Management to create and execute a strategic re-engineering of the FPCS’s capital structure.

The first phase of the plan came to fruition in July 2013 with the closing of two new loans that funded the August 2013 refinancing of $50 million of existing tax-exempt Series 1999 Certificates of Participation with a fixed interest rate of 5.375% and final maturity of 2030. The two new loans are FHA-insured taxable loans at fixed interest rates of 2.73% and 2.80% and have final maturities of 2039 and 2045. They are secured by first deeds of trust on the refinanced properties.

The second phase of the plan came to fruition in September 2013 with the closing of a third loan that funded the redemption of an additional $29.9 million of existing tax-exempt Series 1999 Certificates of Participation. The third FHA-insured taxable loan has an interest rate of 3.74% and is secured by a deed of trust on the refinanced property.

The three new loans will reduce the annual debt service on the refinanced debt by 32% and will reduce overall annual debt service for FPCS by 13%. In addition to funding the partial prepayment of Series 1999 Certificates of Participation, the three loans include funding of approximately $5 million capital expenditures and the costs of issuance for the transactions at these very favorable rates. In addition to the economic benefit of reducing overall debt service of FPCS by $2.3 million annually, this transaction also improves the financial ratios of the Obligated Group by reducing its debt by $79.7 million and annual debt service by $7.2 million. 

FPCS owns and operates 10 multi-level retirement communities in California, including five rental and five entrance fee communities, and manages 25 affordable housing communities as well as three market rate retirement communities. The rental properties were refinanced through the FHA Section 232/223(f) program. 

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Red Capital Partners Closes $20.6 Million Senior Housing Construction Loan

Red Capital Partners, LLC, the proprietary banking arm of RED CAPITAL GROUP, LLC, announced recently the closing of a $20.6 million seniors housing balance sheet construction loan for Kensington of Sierra Madre in California. 

Kensington of Sierra Madre will be a two-story assisted living and memory care community with 90 beds in 75 units. This will be the first purpose-built assisted living facility constructed in the close-knit and highly desirable Los Angeles-area community in approximately 10 years. The property will be developed, owned and operated by affiliates of Kensington Senior Living, LLC.

The non-recourse construction loan will finance the completion and stabilization of the project over an initial five year term. Following successful lease-up, RED CAPITAL GROUP, LLC anticipates providing a permanent loan refinance through Red Mortgage Capital, LLC, its mortgage banking arm. 

“Senior housing debt deals remain difficult to source and RED’s solution orientation combined with exceptional terms provided the ideal capital for us,” said Dan Gorham, Finance Partner at Kensington Senior Living. 

Ziegler YTD Transactions Total More Than $3 Billion

Ziegler’s Senior Living Finance Practice recently announced that it has closed more than 50 senior living financing transactions from November 2012 to date totaling more than $3 billon.

Ziegler Closes $17.6 Million Financing for Fleet Landing

Ziegler recently announced the closing of the $17.6 million tax-exempt fixed-rate Fleet Landing Series 2013B Bond issue for Naval Continuing Care Retirement Foundation, a type-A life care, entrance fee CCRC in Atlantic Beach, Fla.

Proceeds of the Series 2013B Bonds, together with other sources of funds, will be used to fund the construction of 24 assisted living/memory support units and an extensive renovation of the Health Center. The Series 2013B Bonds are tax-exempt, fixed-rate bonds with deferred amortization to wrap-around the Series 2013A Bonds. The Series 2013A Bonds were issued earlier in the year to refund prior indebtedness.

Fitch Ratings have assigned a rating of BBB with a stable outlook to the issue. 

Love Funding Finances $5 Million Senior Living Acquisition 

Love Funding recently announced the closing of a $4.92 million loan for the acquisition of Graceland at Garden Ridge, a 46-bed assisted living and memory care center in Garden Ridge, Texas.

Love Funding Senior Director Leonard A. Lucas of the Boston office secured the loan for the buyer, Cara Graceland LLC, through the HUD Section 232/223(f) LEAN loan program for healthcare facilities.

During the processing of the loan application, HUD exhausted its loan commitment authority from Congress, a development that prevented the agency from issuing a firm commitment, which would allow the borrower to proceed to closing. Love Funding was able to offer the borrower bridge financing against its own balance sheet to keep the acquisition on track and prevent the original purchase and sale agreement from expiring.

“Had the purchase and sale agreement expired, the borrower would have lost his deposit and all costs associated with the transaction,” said Lucas, who has closed more than $200 million in HUD financing multifamily and healthcare transactions year-to-date. “We were in a position to step up and prevent that from happening, and the borrower was extremely appreciative of our support.”

Between the apparent exhaustion of HUD’s commitment authority in July and the funding of the bridge loan last month, the agency recouped some of its previously used commitment authority and was able to issue a firm commitment, allowing the closing of the loan. The HUD insured closing date was set prior to the government shutdown, which allowed the closing to take place during the shutdown itself.

Cain Brothers Structures $19M Bond Transaction for Eskaton

Cain Brothers served as investment banking advisor in connection with a $19.2 million direct bank purchase bond structure transaction for Eskaton Properties, Incorporated. 

Eskaton used the direct bank purchase to convert all of its Series 2008A Bonds to an index mode. Cain Brothers worked with the bank to secure a seven-year capital commitment. Cain Brothers successfully managed and expedited the financing process with closing occurring approximately 60 days after receipt of the final term sheet. The seven-year commitment resulted in a cost of capital below 2% based on interest rates as of the date of transaction closing.

Cambridge Arranges $18M in Loans for Mo. Senior Care Centers

Cambridge Realty Capital Companies recently arranged $14,992,000 loan to refinance the Crystal Creek Health and Rehabilitation Center, a 158-bed skilled nursing facility located in Florissant, Mo.

The fully-amortized, 30-year loan was arranged for the owner, an Ohio limited liability company, using HUD’s Section 232/223(a)(7) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois, the Cambridge business that specializes in underwriting FHA-insured HUD loans.

Crystal Creek Health and Rehabilitation Center is a 158-bed skilled nursing facility. It provides short and long-term care, physical, occupational and speech therapy, Alzheimer’s and dementia care and respite care. Non-medical services include food/dining services, activities, entertainment and religious services.

Cambridge also recently arranged a $3,145,000 loan to refinance the Willow Care Rehabilitation and Health Care Center, a 111-bed skilled nursing facility located in Hannibal, Mo.

The fully-amortized, 30-year loan was arranged for the owner, a Missouri limited liability company, using HUD’s Section 232/223(a)(7) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois.

Cambridge Closes $13.5 Million Loan for ALF Portfolio

Cambridge Realty Capital Companies recently closed $13.5 million in loans to refinance three assisted living facilities owned by a California limited liability company.
The fully-amortized loans were arranged for the owner using HUD’s Section 232/223(f) program and were underwritten by Cambridge Realty Capital Ltd. of Illinois.

The properties and loan amounts are Glen Park West Retirement Community, a 98-bed assisted living facility in Glendale for $5.2 million; Glen Park East Retirement Community, a 97-bed assisted living and memory care facility in Glendale for $4.4 million; and Laurel Canyon Retirement Community, a 68-bed assisted living facility in North Hollywood for $3.9 million. 

Cambridge Arranges $3.6 Million Loan for Ill. SNF

Cambridge Realty Capital Companies reports arranging a $3.7 million loan to refinance the Mattoon Healthcare and Rehabilitation Center, a 123-bed skilled nursing facility located in Mattoon, Illinois.

The fully-amortized, 33-year loan was arranged for the owner, a Missouri limited liability company, using HUD’s Section 232/223(f) funding program and underwritten by Cambridge Realty Capital Ltd. of Illinois.

Cambridge Closes a $6.4 Million Loan for Ind. Senior Care Center

Cambridge Realty Capital Companies reports arranging a $6.5 million loan to refinance the East Lake Rehabilitation Center, a 152-bed skilled nursing facility located in Elkhart, Ind.

The fully amortized, 23-year loan was arranged for the owner, an Indiana limited liability company, using HUD’s Section 232/223(a)(7) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois. 

Beech Street Closes $27.8M Loan for SNF Portfolio 

Beech Street Capital, LLC announced recently that it closed $27.8 million in loans to refinance a 415-bed portfolio of two skilled nursing facilities in Chicago and Momence, Illinois.

The borrower looked to lower the interest rate and create debt service savings to Central Nursing & Rehab Center and Momence Nursing & Rehab Center using FHA’s Section 232/223(a)(7) loan program. The fixed-rate loans have a 30-year term. 

Senior Apartment Complex Gets AHP Grant for Renovation

A $287,000 Affordable Housing Program (AHP) grant to Goodwill Industries of Acadiana Housing Corp. will allow the nonprofit to rehabilitate Maison De Goodwill Apartments, a senior living apartment complex in central Lafayette, La.

The Federal Home Loan Bank of Dallas and IBERIABANK awarded Goodwill Industries the AHP grant. 

Besides providing for a new roof for Acadiana Housing’s Maison De Goodwill Apartments, the grant will fund the replacement of a privacy fence, repairs to the parking lot, and rehabilitation of exterior siding. In addition, some of the units will also receive new energy efficient appliances and insulating doors.

Lancaster Pollard Refinances Five Senior Living Properties 

Lancaster Pollard recently refinanced five senior living properties in Illinois, Kentucky and Ohio.

In Illinois, Lancaster Pollard closed an $8.7 million loan to refinance Heritage Woods of Huntley, a 72-unit assisted living facility, located in Huntley. The transaction funded a $40,000 deposit to the replacement reserve and will generate over $210,000 in annual debt service savings. 

In Kentucky, the firm refinanced two BHI Properties for $9.1 million, Springhurst Health and Rehab, an 82-bed skilled nursing facility, and Parr’s at Springhurst, an 84-bed assisted living facility, using the FHA Sec. 232/223(a)(7) program. Located in Lexington, Ky., BHI is owned and operated by Baptist Homes, Inc., a nonprofit organization.  Baptist Homes was able to save nearly $28,000 annually in debt service. 

Lancaster Pollard also was engaged by the owner of Normandy Manor of Rocky River, a 150-bed skilled nursing facility in Ohio, to refinance an existing HUD-insured loan via the FHA Sec. 232/223(f) program. The refinance was used to fund an expansion of the therapy and memory care space and a renovation of the facility’s common areas while generating annual debt service savings of nearly $125,000.

The firm refinanced tax-exempt bonds for Lutheran Social Services of Central Ohio, a nonprofit organization based in Worthington, Ohio, on its 130-bed skilled nursing facility, Good Shepherd Rehabilitation and Healthcare Campus, in Ashland, Ohio. Using the HUD/FHA Sec. 232/223(f) program, Lancaster Pollard obtained 30-year, nonrecourse debt at a lower interest rate on the $4.6 million loan for the organization. In addition, Good Shepherd was able to perform more than $700,000 in repairs and improvements to the facility and deposit more than $1.2 million into its replacement reserve account to fund future upkeep.

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Cushman & Wakefield Arrange $12 Million Acquisition Financing for LCB

Cushman and Wakefield’s Senior Housing Capital Markets Group has arranged $12.3 million of capital for LCB Senior Living’s acquisition of a memory care community in Lincoln, Rhode Island. The acquisition financing was provided by Wells Fargo Bank, with joint venture equity provided by Prudential Real Estate Investors.

The property is a 60-unit Alzheimer’s community built in 2009. The acquisition closed in late September, with LCB taking over ownership and management. It has been renamed to The Lighthouse at Lincoln.  

Richard Swartz, executive managing director at Cushman and Wakefield, led the team in this transaction along with managing director Jay Wagner, director Aaron Rosenzweig, and associate Stuart Kim. 

Lancaster Pollard Closes Nearly $63 Million in Refinancings

Lancaster Pollard recently refinanced nine nonprofit and for-profit skilled and assisted living facilities for nearly $63 million. The transactions were located in Pennsylvania, Illinois, Missouri and Ohio.

$30.8 Million Refinancing for Three Senior Care Facilities

Lancaster Pollard assisted Wilmac Corporation with the refinance of three skilled nursing and assisted living facilities—Attleboro Nursing & Rehabilitation Center, the Brunswick at Attleboro and the Brunswick at Longstown. 

Lancaster Pollard refinanced a total of $30.8 million using the FHA Sec. 232/223(f) mortgage insurance program for the three facilities. The refinance has helped stabilize cash flow and will allow Wilmac to improve the facilities and invest in human capital. Ken Gould, senior vice president and regional manager of the firm’s Philadelphia office, guided the transaction for Lancaster Pollard. 

$12.4 Million Refinancing of Two Ill. Assisted Living Facilities 

Steve Kennedy, senior vice president and regional manager, who is based out of the firm’s headquarters in Columbus, Ohio, led Lancaster Pollard’s refinancing of two of Heritage Enterprises’ assisted living facilities: Evergreen Place, with 60 units; and Evergreen Village Supportive Living, with 99 beds.

The properties, located in Normal, Ill., are operated by Heritage and owned by joint ventures involving Heritage and two other organizations. Heritage was seeking long-term, nonrecourse financing and faced a balloon payment in 2015. Although it had not previously used HUD/FHA financing, Lancaster Pollard recommended that Heritage use the FHA Sec. 232/223(f) program. The firm orchestrated the closing of two loans with a combined amount of $12.4 million. The transactions refinanced the long-term debt of the facilities into a low interest rate, fully amortizing, nonrecourse, FHA-insured mortgage loan. In addition, refinance risk was eliminated, minor repairs and improvements were financed and a replacement reserve was fully funded for future repairs.

$6.6 Million Refinancing of St. Louis SNF

In another transaction led by Kennedy, Lancaster Pollard refinanced Hillside Manor, a 204-bed skilled nursing facility located in St. Louis, Mo., for $6.6 million using a FHA-insured mortgage loan via the HUD Sec. 232/223(f) program. Lancaster Pollard’s underwriting and structuring of the loan for the property’s manager, SW Management of Chicago, included the funding of capital repairs and improvements as well as helping to allay HUD’s concerns regarding the age of the property. As a result, SW Management obtained a nonrecourse, fixed-rate, fully amortizing long-term loan at slightly over 3%. Loan proceeds funded a significant deposit to replacement reserves, $1.3 million in repairs and paid off existing bank financing.

$4.4 Million Refinancing of Missouri Senior Care Center

In Missouri, Lancaster Pollard aided Eldercare Management Services to refinance an assumed FHA-insured loan for $4.4 million on the recently purchased Adams Street Care Center, a 62-bed skilled nursing facility in Jefferson City. Using the HUD Sec. 232/223(f) program, Lancaster Pollard refinanced the existing HUD loan along with secondary indebtedness that was used for the acquisition and was able to obtain just over a 3% interest rate. The refinancing was managed by Mike Ashley, a vice president with Lancaster Pollard, who is located in the firm’s Lawrence, Kan. office.

$4.1 Million Refinancing of Ohio Health Center

Kass Matt, senior vice president and regional manager, who is based out of the firm’s headquarters in Columbus, Ohio, guided O’Neill Management to refinance an existing HUD-insured loan on Bradley Bay Health Center in Bay Village, Ohio. The facility consists of 138 licensed skilled nursing beds and 33 licensed assisted living units. Lancaster Pollard recommended using the HUD Sec. 232/223(a)(7) program to reduce the existing loan’s interest rate. The $4.1 million refinancing yielded nearly $25,000 in annual debt service savings for the remaining life of the loan. Additionally, O’Neill Management used loan proceeds to make $85,000 in repairs and improvements to the facility.

$4.6 Million Bond Refinancing for Lutheran Social Services of Central Ohio

Separately, Matt also led the refinancing of tax-exempt bonds for Lutheran Social Services of Central Ohio, a faith-based, nonprofit organization based in Worthington, Ohio, on its 130-bed skilled nursing facility, Good Shepherd Rehabilitation and Healthcare Campus, in Ashland, Ohio. Using the HUD Sec. 232/223(f) program, Lancaster Pollard obtained 30-year, nonrecourse debt at an interest rate of over 3% on the $4.6 million loan for the organization. In addition, Good Shepherd was able to do more than $700,000 in repairs and improvements to the facility and deposit more than $1.2 million into its replacement reserve account to fund future upkeep.

GE Capital Commits More than $1.4 Billion to Senior Housing & Care

GE Capital, Healthcare Financial Services has committed more than $1.4 billion in financing for healthcare facilities year-to-date, the firm announced in October. This is an increase in volume over the same period in 2012, and reflects growing confidence and improving fundamentals within the industry. Financing was provided through 47 transactions across senior housing, skilled nursing and medical properties, and was used to support mergers and acquisitions, and portfolio and asset refinancings.

Housing & Healthcare Finance Provides $5 Million Loan for AdCare SNF

Housing & Healthcare Finance, LLC recently announced the funding of a $5 million bridge-to-HUD loan to refinance the existing debt of a 118-bed skilled nursing facility owned by AdCare Health Systems, Inc. (NYSE MKT:ADK).

“We appreciate our growing relationship with HHC Finance,” said Boyd Gentry, CEO and president of AdCAre. “Their timely bridge-to-HUD program was a perfect financing solution for this situation.” 

Independa Closes $2.25 Million Series B Funding Round

Independa, Inc. announced recently that it has secured its initial close of $1.85 million of its $2.25 million Series B Financing round, in order to continue with the market growth of its integrated CloudCare solutions. The latest round was led by City Hill Ventures, a San Diego-based life sciences and healthcare venture capital firm. 

“As demonstrated by its remarkable growth and innovation, Independa clearly leads the market in the development and delivery of its remote care platform,” said Jonathan Lim, M.D., Managing Partner and Founder of City Hill Ventures, in a statement. “City Hill’s investment enables Independa to capitalize on the global demand for its solutions, and accelerate the company’s pace of innovation.” 

Independa will use the additional financing to continue expanding its reach on both a national and global basis, accelerate product growth and innovation, invest in additional sales and marketing resources, and continue engaging with strategic partnership opportunities.

“This capital gives us additional resources to expand quickly and strategically into new markets, continue with our unique and award winning innovations, and meet the rapidly growing demand for our integrated and cost-effective approach to delivering remote care solutions and benefits,” said Kian Saneii, CEO of Independa.

Ziegler Closes $6.7 Million Financing for Two Senior Communities

Ziegler Financing Corporation recently announced the closing of the $6,728,100 refinancing of two Section 202 affordable housing properties, Lincoln Villas North and Trinity Terrace, both owned and managed by Lincoln Lutheran of Racine (LLOR).

Both properties—one a 74-unit apartment complex and the other with 39 units—are located in Racine, Wisc. Ziegler used the HUD Section 202 refinancing policy to refinance both Section 202 direct loans with a collective balance of $3.16 million and refinancing existing deferred management fees and other unfunded operating expenses.

The refinancing proceeds will also be used to capitalize a planned repair program at Lincoln Villas North and to generate significant cash-out proceeds to complete repairs at Trinity Terrace and fund other expenses, along with provide for a developer’s fee and lower the annual debt service costs. 

Lutheran Homes of South Carolina Issues $35 of Bonds

Lutheran Homes of South Carolina Inc., working with the South Carolina Jobs-Economic Development Authority, will issue $35.45 million in health facilities revenue bonds to be used to build a new facility and refinance existing projects.

The Irmo-based organization operates four CCRCs along with Lutheran Hospice and BeWell Home Services. 

Projects funded by the Series 2013 bonds include the $14 million construction of a 44-bed skilled nursing and rehabilitation center for the Rice Estate CCRC and $1 million in renovations at the Heritage at Lowman. The bonds also were used to refinance several buildings throughout the organization’s CCRC portfolio. 


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LTC Enters $141 Million Mortgage Loan Agreement with Prestige

LTC Properties, Inc. (NYSE:LTC) announced recently it has entered a $141 million mortgage loan agreement with affiliates of Prestige Healthcare, secured by 15 properties with a total of 2,092 licensed skilled nursing beds and 24 independent living units in Michigan. 

The loan has a 30-year term with an initial 9.41% interest rate for five years, after which it will escalate annually by 2.25%. Payments will be interest-only for three years; the borrower will then make interest payments along with annual principal payments of $1 million. 

LTC expects to fund about $126 million of the loan during the fourth quarter of 2013, with additional forward commitments of $12 million for capital improvements and up to $3 million for short-term working capital. The mortgage loan agreement also provides (under certain conditions and based on operating metrics and valuation thresholds achieved and sustained within the first 12 years of the term) for additional loan proceeds of up to $40 million, limited to $10 million a year.

Louisville, Ky.-based Prestige Healthcare will have a one-time option between the third and twelfth years to prepay up to 50% of the outstanding loan balance without penalty. Because of this option, LTC separated the properties collateralizing the loan into two pools of assets. If Prestige exercises the option, LTC will identify which of the two pools it will release for prepayment and removal from the portfolio of properties securing the loan. 

If the prepayment option is exercised and concluded in a timely manner, then Prestige will forget its opportunity to access any additional loan proceeds.

Under certain circumstances—such as a change in the regulatory environment—LTC has an option to purchase the properties. 

“LTC is very pleased to announce this transaction expanding our existing relationship with Prestige Healthcare, further diversifying our operator base, enhancing our geographic diversification and increasing our presence in the top 31 Metropolitan Statistical Areas,” said Wendy Simpson, president and CEO of LTC. “Furthermore, this off-market transaction demonstrates the success of our relationship oriented marketing strategy and our strategy to invest in newer or newly renovated skilled nursing assets or properties with expansion and/or renovation potential. Although structured as a long term mortgage loan to meet the needs of our customer, this transaction embodies most elements of a long term master lease.”

Ziegler Closes $94 Million Financing for Mass. Senior Community

Ziegler recently announced the closing of the $93,625,000 unrated, fixed-rate Series 2013 Bonds for North Hill Communities, Inc., the not-for-profit parent corporation to North Hill Needham, Inc., North Hill Home Health Care, Inc., and True North Development LLC.

North Hill Needham, Inc. is a senior living campus near Wellesley in Massachusetts comprised of 285 independent living units, 72 skilled nursing beds, and common and administrative areas.

The Series 2013 Bonds, along with an equity contribution from North Hill, are being issued for the renovation, expansion, and equipping of existing independent living apartments and common areas, including existing and new dinging venues, a wellness center, and a conference suite; the renovation and equipping of a new enhanced independent living and maintenance facility, a connector facility, and various additions to common areas; and the construction and equipping of an approximately 71,930-square-foot new skilled nursing facility.

Bond proceeds will also be used for site improvements related to these projects, along with the funding of interest through Dec. 31, 2014, the funding of debt service reserve funds, and the payment of the cost of issuance related to the Series 2013 bonds.  

Beech Street Closes $7.6 Million Loan for St. Louis SNF

Beech Street Capital, LLC announced recently the closing of a $7.6 million loan under the HUD Section 232/223(f) refinancing program for Green Valley Nursing & Rehabilitation Center, a 150-bed skilled nursing facility in St. Louis, Mo.

Joshua Rosen, executive vice president of Beech Street Capital, originated the transaction out of the firm’s Chicago office.

The loan for ROMA Healthcare, the facility’s owner, was about to expire and Beech Street was able to negotiate the timing of the closing with HUD to ensure the borrower was able to pay off the loan on time. 

American Realty Capital Launches $300 Million Offering

American Realty Capital Properties, a New York-based commercial REIT, recently announced plans to issue $300 million of convertible senior notes in an underwritten public offering. 

The notes are due to mature on August 1, 2018 and may be converted into cash, common stock, or a combination of those in limited circumstances, prior to February 1, 2018.

The REIT plans to grant underwriters a 30-day option of purchasing an additional $30 million in notes in the case of over-allotments. 

American Realty Capital plans to use the proceeds from the offering to repay outstanding indebtedness under its existing senior secured revolving credit facility, which will then increase the availability of funds under this credit facility. The REIT also gains ability to invest in more properties.

JPMorgan Chase, Citigroup, Barclays, BMO Capital Markets and KeyBanc Capital Markets will act as joint bookrunners for this offering. JMP Securities, Ladenburg Thalmann & Co., and RCS Capital, the investment banking and capital markets division of Realty Capital Securities, will act as co-managers for the senior note offering.

Grandbridge Facilitates Bridge Financing for Ore. Senior Community

Grandbridge’s Seniors Housing Group facilitated the $12,225,000 bridge financing for Morningside Development Group for the recapitalization and minor renovations of Quail Park Memory Care Center in Eugene, Ore.

The non recourse bridge financing was facilitated by Grandbridge through its proprietary lending platform, BB&T Real Estate Funding LLC. 

Lancaster Pollard Refinances Ohio CCRC

Lancaster Pollard recently assisted Methodist ElderCare Services in refinancing its existing HUD-insured loan on the skilled nursing and assisted living portions of Wesley Glen, its flagship continuing care retirement community, for $13.1 million.

The campus, located in Columbus, Ohio, has 369 units of independent living, assisted living, memory care, and skilled nursing care. 

Lancaster Pollard utilized the FHA Section 232/223(a)(7) loan program on behalf of Wesley Glen and was able to obtain a low interest rate, allowing the not-for-profit organization to benefit from net present value savings of approximately $1.5 million over the life of the loan.

Kass Matt, senior vice president and regional manager at Lancaster Pollard, led the transaction. 

Oxford Finance Closes $7.2 Million Financing for SNF Acquisition

Oxford Finance LLC announced recently that it closed a $7.2 million senior secured term loan with Pritok Capital, the proceeds of which were used to acquire Nentwick Care Center, a 100-bed skilled nursing facility in East Liverpool, Ohio. 

“Oxford is very pleased to provide capital to Pritok for the acquisition of Nentwick Care Center,” said Christopher A. Herr, managing director for Oxford Finance. “Pritok has a strong investment platform for acquiring high quality seniors housing assets nationally, and we look forward to partnering with them on future transactions.”

Love Funding Closes $7.24 Million Loan for Seattle Senior Care Center

Love Funding recently closed a $7.24 million loan to refinance Sea Mar Community Care Center, a 100-bed skilled nursing facility in Seattle.

Artin Anvar, a senior director out of Love Funding’s Washington, D.C. office secured the loan through the HUD Section 232/223(a)(7) LEAN program, allowing the borrower to lock in a low, fixed-rate, non recourse loan for a 33-year term and generate more than $215,000 in annual debt service savings.

Spectrum Completes $124 Million Financing with Bank of the West

Spectrum Retirement Communities, LLC, a developer, owner, and operator of senior living communities, recently completed a $124 million financing transaction led by Bank of the West as the agent bank.

Spectrum will use the $124 million term loan to refinance existing debt and buy out an equity partner for a six-property senior housing portfolio. Communiites are located in Kansas, Missouri, Illinois, and Arizona. 

Bank of the West acted as administrative agent and lead arranger for the syndicated loan. Other lenders in the syndicated loan were Compass Bank, Colorado Business Bank, and Raymond James Bank, N.A. 

Cushman & Wakefield Arranges $38.3 Million Financing for LCB

Cushman & Wakefield’s senior housing capital markets group recently arranged the $38.3 million capitalization of LCB Senior Living, LLC’s first two development projects.

For the first project, Cushman arranged the $19.8 million of debt financing and equity investment for the construction and development of The Residence at Riverbend, which will be a 75-unit independent living, assisted living, and memory care community. PNC Bank provided construction financing, with joint venture equity provided by Prudential Real Estate Investors. The project is expected to break ground this summer and be completed in Fall 2014.

Cushman also arranged an $18.5 million construction loan for The Residence at Watertown Square, which will be a 90-unit independent living, assisted living, and memory care community in Watertown, Mass. For this project, LCB is partnering with the New England Carpenter’s Union, a separate account pension fund that is represented by Great Point Investors. PNC provided construction financing for the project, which is underway and expected to open in Fall 2014.

The Cushman & Wakefield team involved in the transaction include Richard Swartz, Phil Anderson, Jay Wagner, Aaron Rosenzweig, and Stuart Kim.

Oak Grove Originates $11 Million Loan for Ore. Senior Housing Property

Oak Grove Capital originated an $11.14 million loan for Canfield Place, an 88-unit property in Beaverton, Ore. The Freddie Mac CME Fixed Rate loan was facilitated by Jeff Ringwald, senior vice president at Oak Grove Capital.

Contemporary Healthcare Capital Provides $5.8 Million Loan for ALZ Community

Contemporary Healthcare Capital, LLC recently provided a $4.5 million senior loan and a $1.25 million mezzanine loan for the financing of a 54-bed memory care community in Green Valley, Ariz.

The borrower will use the proceeds to refinance existing debt, provide working capital, and pay closing costs. 

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Three Pillars Senior Living Communities Issued $22.8 Million Bonds

Cain Brothers served as sole underwriter in the issuance of the Three Pillars Senior Living Communities Series 2013 bonds, issued as unenhanced fixed rate bonds and rated “A-” by Fitch on the underlying credit strength of Three Pillars. The $22.82 million bond issuance was used to refund and consolidate all four of Three Pillars’ outstanding debt obligations into a single bond issue.

The Series 2013 bond financing provides Three Pillars with a more stable capital structure by consolidating four outstanding bond issues (two fixed, two variable) into a single fixed rate tax-exempt bond issue with flexible bond covenants and 30-year level debt amortization, at an average yield of 3.99%. The Series 2013 issue enhanced Three Pillars’ risk profile by eliminating interest rate risk and bank renewal risk and improving key credit metrics.

Cain Brothers created an amortization structure that allowed Three Pillars to stretch out its debt structure from 2026 to 2043 and lowered maximum annual debt service by over $566,000—a 26% reduction. 

Three Pillars consists of Wisconsin Masonic Home, Inc., Masonic Center for Health and Rehab, Inc., and Village on the Square, Inc., which together serve as a continuing care retirement community offering independent living, assisted living, and skilled nursing care. In total Three Pillars’ facilities offer 151 independent living units, 95 assisted living units and 85 skilled nursing beds.

Cambridge Arranges $10.2 Million of Loans for Four Nursing Homes

Cambridge Realty Capital Companies reports arranging $10.2 million in HUD Lean loans to Pacifica Nursing and Rehab to refinance four skilled nursing home properties owned by North American Health Care, Inc. in California and Utah.

The fully-amortized loans were arranged for the owner using the HUD Section 232/223(a)(7) funding program and were underwritten by Cambridge Realty Capital Ltd. of Illinois, the Cambridge business that specializes in underwriting FHA-insured HUD loans.

Hymie Barber, National Originations Manager and Managing Director of Catalyst/Cambridge Healthcare Finance in Los Angeles, the company’s West Coast affiliate, led the transaction. Combined, the refinanced loans saved the owner $250,000 in mortgage payments annually, Barber said

The four senior care properties included in the Pacifica portfolio are: Pacifica Nursing and Rehabilitation, a 68-bed skilled care nursing home in Pacifica, Calif. with a $2.08 million loan total; Coventry Court, a 97-bed skilled nursing home in Anaheim, Calif. with a $2.2 million loan total; Garden View, a 97-bed skilled nursing home in Baldwin Park, Calif. with a $2.3 million loan total; and Orchard Park Care Center, an 89-bed skilled care nursing home in Orem, Utah with a $2.5 million loan total. 

Cambridge Provides $14 Million Loan for Chicago Senior Care Center

Cambridge Realty Capital Companies recently announced closing a $14 million loan to refinance Alden Northmoor Rehabilitation and Health Care Center, a 198-bed skilled care nursing home in Chicago.

The fully-amortized, 32-year term loan was arranged for the owner using the HUD Section 232/223(f) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois.

Ziegler Closes $14.8 Million Financing for PRCN

Ziegler recently announced the closing of a $14,840,000 tax-exempt, fixed-rate Presbyterian Retirement Communities Northwest Series 2013 Bond issue. Presbyterian Retirement Communities Northwest is a Washington-based not-for-profit corporation established in 1956 to develop, own, and operate senior housing communities.

The Series 2013 Bonds, along with other available funds, are being issued to refund all of PRCN’s outstanding Series 1999A Bonds; pay or reimburse PRCN for the costs of the acquisition of land and the acquisition, construction, remodeling, renovation, and equipping of existing facilities at Exeter House, Park Shore, and the its corporate headquarters; fund a debt service reserve fund; and pay the costs of issuing the Series 2013 Bonds and refunding the Series 1999 Bonds.

KeyBank Arranges $21 MIllion of Loans for Two Senior Housing Properties

KeyBank Real Estate Capital recently closed two HUD Section 232/223(a)(7) loans totaling $21 million for senior housing properties in Maine and Texas. 

One loan was in the amount of $12.5 million for Williamsburg Village Health Center, a 242-unit skilled nursing facility in Desoto, Texas. Alison Holland, VP of Healthcare Agency Lending for KeyBank, worked with the borrower, Stonegate Senior Living, to complete the refinance. 

The other loan was an $8.5 million refinance for Mid Coast Senior Health Center, a 100-unit skilled nursing and assisted living/memory care community in Brunswick, Maine. Jack Boulder, SVP for Key Bank’s Senior Housing and Healthcare Group, and John Everett, VP of KeyBank’s Commercial Banking team, worked with the borrower, Mid Coast Health Services, on the transaction. 

Love Funding Secures $8.95 Million Refinance for Conn. Health Center

Love Funding recently announced the closing of an $8.95 million loan to refinance Birmingham Health Center, a 120-bed skilled nursing facility in Derby, Conn.

Leonard Lucas, senior director of Love Funding out of the firm’s Boston office, secured the loan through HUD’s Section 232/223(a)(7) loan program, allowing Lucas to lock in a low, fixed interest rate over the remaining term of the original loan and generating significant debt service savings for the borrower.

Birmingham Health Center was built in 1965 and underwent renovations in 2003 and 2004. It is operated by Spectrum Heatlhcare, based in Connecticut. 

Lancaster Pollard Refinances 7 Properties in N.C. and Ill. 

Lancaster Pollard recently assisted Oliver Development with the $7.5 million refinance of Cambridge Hills Assisted Living in Roxboro, N.C.

Cambridge Hills is a 120-bed, 60-unit assisted living community built in 2000. Oliver Development was looking to refinance its existing bank debt and obtain non recourse, fixed-rate financing and generate credit capacity with its bank, and followed Lancaster Pollard’s recommendation to use the HUD Section 232/223(f) program for the refinancing. 

John Randolph out of Lancaster Pollard’s Atlanta office, led the transaction, which refinanced existing debt from multiple bank loans into one loan and established a replacement reserve account along with allowing Oliver Development to benefit from significant debt service savings. 

In another transaction, Lancaster Pollard guided Petersen Health Care through its first HUD financings, recommending the Peoria, Ill.-based company to refinance six of its skilled nursing facilities using the HUD Section 232/223(f) program. 

Petersen Health Care owns and operates more than 90 senior living communities in the Midwest and the company’s leadership was looking to strengthen its financial position by refinance existing variable rate loans from a bank syndicate on the six facilities. 

The company’s new long-term FHA loans eliminate the owner’s personal guarantee from the facilities’ debt structure, appropriately leverages each property’s balance sheet, and provides more than $170,000 in annual debt service savings from a lower interest rate and approximately 30-year blended term and amortization. 

Additionally, Petersen was able to use some of the refinancing proceeds to add $1.6 million to the facilities’ replacement reserve accounts and completed $650,000 in capital improvements in conjunction with the refinance. Steve Kennedy, senior vice president with Lancaster Pollard out of the Columbus, Ohio office, led the transaction. 

Capital One Closes $48 Million Loan for LCS-Westminster Partnership

Capital One Bank announced recently it served as the lead bank and administrative agent for a $48 million, five-year term loan to LCS-Westminster Partnership, IV LLP.

The loan will be used to refinance and expand Sagewood, a newly constructed senior living community located on 47 acres in Phoenix, Ariz. with 278 independent living units, a 48-bed health center with skilled nursing and assisted living units. The loan will also be used to finance the construction of 14 additional casitas to the existing 24, and complete a second dining venue for Sagewood.

LCS-Westminster is a joint venture of The Westminster Funds and LCS, with The Westminster Funds serving as the majority equity partner for LCS-Westminster developed projects. 

Love Funding Secures $28 Million Refi for Two Miami SNFs

Love Funding recently announced the closing of two loan refinancings totaling $28 million for two skilled nursing facilities that are part of the Plaza Health Network.

Arch Plaza Nursing and Rehabilitation Center and Ponce Plaza Nursing and Rehabilitation Center are among nine senior care facilities in the Miami area that are part of the Plaza Health Network, owned by independent affiliates of the Hebrew Homes Health Network, a not-for-profit organization. 

Love Funding’s Washington, D.C. office secured the loan through the HUD Section 232/223(f) LEAN program, which enabled the borrower to lock in a low fixed-rate non-recourse loan for a 30-year term. 

Love Funding Closes $5.5 Million Construction Loan for Ill. ALF

Love Funding recently announced closing a $5.51 million construction-to-permanent loan for Cedarhurst of Edwardsville, a new assisted living community under development in Edwardsville, Ill.

Robyn Cunningham, a senior director out of Love Funding’s St. Louis office, together with Director Adrian Hartman, secured the financing through the HUD Section 232 new construction loan program. The program enabled the borrowers to lock in a fixed, low-rate, non-recourse loan for a 40-year term once construction is completed.

Cedarhurst at Edwardsville will offer 54 memory care beds and is being developed by Metro Asset Group LLC. 

National Health Investors Announces $370 Million Credit Facilities

National Health Investors (NYSE:NHI) announced recently it has entered into amended $370 million senior unsecured credit facilities including a $250 million revolving credit facility and $120 million of 7-year term loans.

The revolving credit facility matures in five years, including an embedded 1-year extension option. The term loans mature in seven years. At closing, the new facilities replaced smaller credit facilities that originated on May 1, 2012 and provided for $320 million of total committed facilities. 

“We appreciate the considerable commitments offered by the banks participating in this credit facility, which result in low borrowing costs, extended loan maturities and additional borrowing capacity that offers substantial support to NHI’s growth,” said Justin Hutchens, president and CEO of NHI. 

Wells Fargo Securities, LLC, BMO Capital Markets and KeyBank National Association were joint lead arrangers for the facilities and arranged a syndicate that included nine banks. BMO Capital Markets and Wells Fargo Securities, LLC were joint lead arrangers for the $120 million 7-year term loan facility. Other banks in the credit facility are Bank of America, Regions Bank, Pinnacle National Bank, United Community Bank, Stifel Bank & Trust and UMB Bank.

The terms of the amended credit facility can be seen here.

Health Care REIT Announces Continued Conversion Option for Senior Notes

Health Care REIT (NYSE:HCN) on July 1 notified holders of its 3.00% Convertible Senior Notes due 2029 of their continued ability to convert all or a portion of their notes into cash and, if applicable, shares of the company’s common stock through the close of business on Sept. 30, 2013.

The notes remain convertible because the closing price of shares of HCN’s common stock, for at least 20 trading days during the 30 consecutive trading-day period ending on June 28, 2013, was greater than 120% of the conversion price in effect on that date.

More details can be viewed here.  

NorthStar Realty Finances Completes $1.1 Billion Offering for Non-Traded REIT

NorthStar Realty Finance Corp. (NYSE: NRF) announced on July 1 that NorthStar Real Estate Income Trust, Inc. successfully completed its primary offering having raised $1.1 billion in aggregate gross offering proceeds, including $528 million year-to-date, through its captive broker-dealer, NorthStar Realty Securities, LLC. 

“We are extremely pleased with the successful completion of our first sponsored non-traded REIT and are looking forward to capitalizing on this strong momentum with our $2.75 billion of additional non-traded products currently being offered,” said David T. Hamamoto, chairman and CEO. “These programs are expected to generate substantial long-term fee income for our shareholders and the completion of NorthStar Income is a strong testament to the growth of our asset management business and our diverse and broad commercial real estate platform.”

Capital One to Hold $100 Million Loan for Formation Capital

Capital One Bank acted as a joint book runner on a $213.5 million secured term loan to FC Ranger Acquisition, LLC, to finance the acquisition of a portfolio of 26 senior housing properties. 

Formation Capital is the sponsor behind FC Ranger Acquisition, LLC and partnered with SAFANAD for the acquisition. 

Capital One Bank will hold $100 million of the term loan and will also provide deposit and treasury management services to the facilities. 

Caremerge Raises $2.1 Million for Business Expansion

Caremerge, a Chicago-based health tech provider of mobile and web communication and care coordination solutions, has raised $2.1 million in a Series A Funding.

The company’s HIPAA-compliant and secure mobile/web apps allow senior care providers to quickly capture, chart, and share seniors’ information with families and outside stakeholders such as ACOs, MCOs, hospitals, and physicians.

“Today, long term care is challenged with increasing regulations, high staff turnover, reduced reimbursements and lower profit margins,” says Asif Khan, the founder of Caremerge. “Most people believe that the long-term care industry is slow to adopting technology. At caremerge, we beg to differ and believe that until now technology hasn’t adopted to the unique challenges and workflows of long-term care.”

Grazyna Kulczyk of Poland, an entrepreneur, real-estate developer, and art collector, led the investment, with participation from another Switzerland-based investor.

Athena Heritage, a Swiss Financial Management company, provided advisory services to the investors, and Privity FZ LLE, a U.A.E.-based company, also played a key role in the transaction. 

Caremerge was founded in 2010 and was selected by GE and StartupHealth in a Health Growth Acceleration program in April 2013. 

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The Department of Housing and Urban Development (HUD) announced in late June it would revise a notice that eliminated developer fees for refinances of Section 202 Supportive Housing for the Elderly properties. 

A May 30 Notice on Updated Requirements for Prepayment and Refinance of Section 202 Direct Loans said that no developer fee is allowed from the proceeds of an FHA-insured Section 223(f) refinance of Section 202 direct loans. On June 26, HUD released a statement to the effect it would revise the notice due to feedback received from lenders, including the reinstatement of the developer fee. 

By and large, the notice was a compilation of prior guidance, several prior notices, several memos, and responses for frequently asked questions, says Nick Gesue, chief credit officer at Columbus, Ohio-based Lancaster Pollard. It also contained a couple surprises that were “completely unexpected” by many lenders and Section 202 owners, many of whom are not-for-profit. 

“A big part of what HUD wants borrowers to do [as part of a refinance] is to update the buildings, as many were built in the ’70s and ’80s,” Gesue says. “As a way to incentive nonprofits, they allowed developer fees.”

The rules for developer fees changed from 15% of the repair amount Section 202 owners will spend on a property after refinancing to 15% of the amount of the prior financing a couple years ago, revised by HUD to match the Low Income Housing Tax Credit program. In the May 30 notice, HUD rewrote the instances of where a developer fee is allowable.

“[The change] eliminated the ability to get a developer fee [unless you were] using tax credits,” Gesue says. “The net result was, if you wanted to do a debt-only refinance, the developer fee was no longer allowable… It was immediately effective with no phasing in, and it caught everyone off guard.” 

Lenders including Lancaster Pollard began rallying clients to express concern directly to HUD regarding the notice. HUD never gave any indication of motivations to eliminate the developer fee and did not respond to SHN’s request for such information, although according to Gesue some within the agency might have felt the fees were getting too large. 

However, eliminating those fees resulted in its own issues, including the ability to afford repairs and updates to properties. 

HUD programs require borrowers to put up cash escrows as a contingency reserve for development and many Section 202 owners don’t have a lot of cash, Gesue says. Often, the developer fee acts as the cash reserve until the work is done and protects against cost overruns.

A lender working with a Section 202 owner underwrites new loans to repay the property’s existing debt, cover the closing costs, and fund a certain amount of repairs and improvements to the project, including a developer fee. At the time of underwriting the loan, the property’s owner has to specify to the lender the scope of the planned improvements so that when the lender goes to HUD, it can be very specific as to the costs of the project and how much the loan needs to be.

If a loan was underwritten expecting $620,000 worth of work to be done on a property that ended up costing $650,000, then a portion of the owner’s $93,000 developer fee could be used to pay for the additional cost. Because developer fees are often used to cover the contingency escrow, their elimination cast uncertainty onto already-underwritten deals.

“We had to put a number of deals on hold and tread water with them until we knew what we could and couldn’t do, how we’d have to underwrite it, and the advice to give to clients,” Gesue says. 

It’s not just about the money, he says: The changes would have made many deals either “infeasible or unpalatable.”

“It’s not so much people complaining about the lack of the developer fee itself—it’s been really really well-received, and it’s put to great use by a lot of nonprofits,” says Gesue. “It’s necessary to cover a HUD required contingency escrow, [and without the developer fee] many would otherwise not have the cash to do that.”

Had the rule remained, he predicts it would have caused a number of transactions to become “extremely” challenged in terms of feasibility. However, the fee was reinstated thanks in large part to collaborative efforts by Lancaster Pollard vice president Ryan Miles, chair of the Sect. 202 Working Group, and the MBA Multifamily FHA Committee.

“In the world of the government, this was a pretty big turnaround from issuance [in late May] to rescinding some of it [by June]. HUD probably hadn’t fully appreciated the use of the developer fee from a structural or incentive perspective,” Gesue speculated. “As soon as we laid out why it’s so important, they were really quick on the turnaround.” 

 Written by Alyssa Gerace

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Cambridge Closes $42.8 Million of Senior Housing & Care Loans

Cambridge Closes $14.9 Million Nursing Home Loan

Cambridge Realty Capital Companies recently announced the closing on a $14.9 million loan to refinance Green Park, a 188-bed skilled nursing home in St. Louis, Mo., announced chairman Jeffrey Davis. 

The fully-amortized, 36-year term loan was arranged for the owner, an Ohio limited liability company, using the HUD Section 232/223(a)(7) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois, the Cambridge business that specializes in underwriting FHA-insured HUd loans. 

Cambridge Closes $12.6 Million Loan for Ill. Senior Care Property

Cambridge Realty Capital Companies recently reported closing a $12.6 million first mortgage loan for Hawthorne Inn of Danville, a 140-bed skilled nursing care and assisted living property in Danville, Ill.

The fully-amortized, 30-year term mortgage loan was arranged using the HUD Section 232/223(a)(7) refinance program and was underwritten by Cambridge Realty Capital Ltd. 

The property has 76 skilled care beds and 65 assisted living units, according to Cambridge chairman Jeff Davis. 

Cambridge Closes $3.9 Million Loan for Texas Senior Care Center

Cambridge reported closing a $3.9 million first mortgage loan for Windsor Care Center, a 108-bed skilled nursing home in Terrell, Texas.

The fully-amortized, 35-year term mortgage was arranged for the owner using the HUD Section 232/223(a)(7) refinance program and was underwritten by Cambridge Realty Capital Ltd. of Illinois with an undisclosed interest rate. 

Cambridge Closes $2.4 Million Loan for Wisc. SNF

Cambridge recently reported closing on a $2.4 million loan to refinance Alden Meadow Park, a 94-bed skilled nursing home in Clinton, Wisc. The fully-amortized, 30-year term loan was arranged using the HUD Section 232/223(a)(7) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois. 

Cambridge Closes $9 Million of Loans for Two Indiana Nursing Homes

Cambridge Realty Capital Companies reports arranging $9 million worth of loans to refinance two skilled nursing home properties in southern Indiana.

The fully-amortized, 24-year term loans were arranged for the owner, Transcendent Healthcare, for properties in Boonville and Owensville, Ind. One loan, for $4.68 million, was used to refinance the 88-bed Transcendent Healthcare of Boonville property. A $4.32 million loan was arranged to refinance the 68-bed Transcendent Healthcare of Owensville.

Both loans were arranged using the HUD Section 232/223(a)(7) funding program and were underwritten by Cambridge Realty Capital Ltd. of Illinois.

Lancaster Pollard Closes $11.4 Million Refinance for Ohio SNFs

Lancaster Pollard recently assisted Hennis Care Centre with the refinancing of two of their skilled nursing facilities: Hennis Care Centre of Bolivar, a 99-bed SNF, and Hennis Care Centre of Dover, a 137-bed SNF with 10 assisted living units, both located in Northeast Ohio.

The facilities were refinanced using the FHA-insured HUD Sec. 232/223(a)(7) program. The total loan amount of $11.4 million will allow Hennis Care Centre to achieve significant debt service savings. Kass Matt, out of Lancaster Pollard’s headquarters in Columbus, Ohio, led the transaction.

Ziegler Closes $21.6 Million Financing for Kendal at Oberlin

Ziegler recently announced the closing of the $21.6 million tax-exempt, fixed-rate Kendal at Oberlin Series 2013A Bond issue. Kendal at Oberlin is an obligated group which owns and operates a continuing care retirement community in Oberlin, Ohio.

The borrower is a subsidiary of Kendal Northern Ohio, which is affiliated with The Kendal Corporation.

Proceeds from the sale of the Series 2013A Bonds together with available funds will be used to refund and retire the outstanding County of Lorain, Ohio Health Care Facilities Revenue Refunding Bonds, Series 1998 A and a loan from Lorain National Bank to the borrower in the principal amount of $2.38 million. 

The proceeds will also be used to pay or reimburse the borrower for the payment of certain costs of acquiring, constructing, installing, and equipping the project, and to fund a portion of the debt service reserve fund for the benefit of the Series 2013A Bonds, along with paying certain expenses associated with the cost of issuing the bonds. 

The Series 2013B bonds will consist of a bank direct placement by Lorain National Bank to fund future capital expenditures over the next three years. The bank has a 13-year commitment through the final maturity of the Series 2013B bonds, and Kendal at Oberlin will also amend the existing Series 2009A&B bank qualified bonds to match the bank’s commitment to the final maturity of the bonds and to lower the fixed interest rate. 

Cambridge Provides $21.7 Million Loan for Senior Apartment Complex

Cambridge Realty Capital Companies recently provided a $21.7 million loan to refinance Morningside North Apartments, a 256-unit senior apartment complex in Chicago. 

The fully-amortized, 33-year term loan was arranged using the HUD 232/223(f) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois, according to Cambridge chairman Jeffrey Davis. 

Love Funding Closes $22.7 Million in Financing for Mass. SNF Portfolio

Love Funding recently announced the closing of three loan refinancings totaling $22.7 million for a portfolio of skilled nursing facilities in Massachusetts.

Leonard Lucas, a senior director out of Love Funding’s Boston office, secured the loans through the HUD Section 232/223(f) LEAN loan program for long-term care facilities. 

The facilities benefiting from the refinancing are Royal Cape Cod Nursing and Rehabilitation Center in Buzzards Bay, Royal Falmouth Nursing and Rehabilitation Center in Falmouth, and Royal Taber Street Nursing and Rehabilitation Center in New Bedford. The centers offer a total of 270 beds and are operated by Royal Health Group, a family-owned company founded by James Mamary Sr. in 1997.

Lucas also secured an $8.7 million loan refinancing for Country Villa Rehabilitation Center, a Los Angeles skilled nursing facility, last month. 

Love Funding Secures $4.34 Million in Financing for Maine Senior Care Portfolio 

Love Funding recently closed three loan refinancings totaling $4.34 million for a portfolio of senior care properties in Maine. 

Leonard Lucas, a senior director out of Love Funding’s Boston office, secured the loans through the HUD 232/223(a)(7) LEAN loan program. 

The refinanced facilities are Klearview Manor in Fairfield; Northland Living Center in Jackman, and Sanfield Rehabilitation and Living Center in Hartland. The centers offer a total of 64 beds and are operated by North Country Associates Inc.

Freddie Mac Approves Greystone as Designated Seniors Housing Seller/Servicer

Greystone announced on Tuesday that it has been approved as a National Senior Housing Seller/Servicer by Freddie Mac to originate and service multifamily seniors housing loans nationwide.

The designation allows Greystone to better meet the financing needs of the rapidly growing senior sector, according to the company. To be considered for the designation, lenders are evaluated by Freddie Mac based on a number of qualifications, including GSE loan origination and underwriting experience for seniors housing properties, staff experience in the seniors housing market, and track record of seniors housing loan performance. 

“Freddie Mac’s capabilities and specialized team of Seniors Housing experts have already added value to one of our long term clients and we are excited to bring Freddie Mac to all our clients going forward,” said Scott Kavel, Managing Director for Greystone’s senior housing lending business.

Lancaster Pollard Closes Loans for Two Midwest Senior Care Properties

Lancaster Pollard recently reported completing a $6.9 million refinancing of a 92-unit assisted living, independent living, and memory care property in Bridgman, Mich. using the HUD Section 232/223(f) program.

The provider was able to refinance its existing term note and line of credit, which provided significant debt service savings and funded a large deposit to replacement reserves for ongoing capital needs, including $25,705 in repairs to the facility. The family-owned organization was able to remove personal guarantees under the new financing structure, freeing up borrowing capacity to fund future growth.

Brendan Healy, a vice president out of Lancaster Pollard’s Columbus office, led the transaction.

Lancaster Pollard also recently worked with The Birches Assisted Living, a 90-unit licensed assisted living facility in Clarendon Hills, Ill., to refinance the facility’s existing FHA loan. The firm closed financing for the provider through the HUD Section 232/223(a)(7)  program to obtain a reduced interest rate and help realize nearly $60,000 of annual debt service savings, totaling more than $1.8 million for the remaining life of the loan.

Steve Kennedy, senior vice president and regional manager with Lancaster Pollard out of the firm’s Columbus office, led the transaction. 

ELS Initiates $435 Million Refinancing

Equity LifeStyle Properties, Inc. (NYSE:ELS) announced on June 3 its plans to obtain $435 million in new mortgage loans from institutional lenders, secured by mortgages on 25 manufactured home and RV properties. The loans are expected to bear a blended interest rate of 4.3% per annum, and to have maturities ranging from 10 to 25 years with a weighted average maturity of about 18 years.

Proceeds from the financing will be used to repay debt with a weighted aerate effective interest rate of 5.7%. This includes ELS’ remaining 2013 debt maturities as well as approximately $102 million maturing in 2014 and about $295 million maturing in 2015. ELS elects to use available cash to pay approximately $37 million in prepayment penalties.

The financing is expected to close in stages beginning in the second quarter of 2013 with the final closing expected to occur in April 2014.

“The current financing environment offers an opportunity to obtain long-term financing for our RV and MH assets at historically low interest rates. This transaction allows us to reduce our overall cost of debt approximately 20bps to 5.3% and extend our weighted average maturities from 4.5 years to more than 7 years,” said Marguerite Nader, CEO of ELS. “In addition, through this transaction we expect to restructure our debt maturities so that we have no more than $300 million maturing in any single year going forward.”

Ziegler Closes $24.8 Million Financing for Plymouth Place

Ziegler announced on Thursday the closing of the $24,765,000 tax-exempt, fixed-rate Plymouth Place Series 2013 bond issue. Plymouth Place is located in LaGrange Park, about 15 miles outside of downtown Chicago, Ill., and is managed by Providence Management. 

Proceeds from the sale of the Series 2013 Bonds, together with other funds, will be used to refinance the outstanding Series 2005B and Series 2005C Bonds, all of which were variable rate demand bonds with credit enhancement through letters of credit. The Series 2013 Bonds consist of one fixed-rate, tax-exempt term bond. Principle on the 2013 bonds will be amortized during 2038-2043, after the final maturity of Plymouth Place’s only other debt, the fixed-rate Series 2005A bonds. 

Love Funding Closes $4.74 Million Loan for Okla. Assisted Living Community

Love Funding recently announced the closing of a $4.74 million loan refinancing for Heritage Assisted Living, a 79-unit assisted living center in Yukon, Okla.

Love Funding Senior Director Robyn Cunningham of the St. Louis office, together with Director Adrian Hartman, secured the financing through the Department of Housing and Urban Development’s Section 232/223(f) LEAN loan insurance program.

Heritage Assisted Living was built in 2000, and joined Oklahoma’s Advantage Waiver Program in 2010. The property was the first assisted living center in the Oklahoma City area to join the state’s long-term care program, which provides Medicaid-funded home and community-based services to frail elders and adults with disabilities.

Eskaton Properties Issued $51.9 Million Tax-Exempt Fixed-Rate Bonds

Cain Brothers recently served as sole underwriter and swap advisor in the issuance of the Eskaton Properties, Inc. Series 2013 Bonds, issued as unenhanced fixed rate bonds rated “BBB” by S&P on the underlying credit strength of Eskaton.

The bonds were used to refinance EPI’s Series 2008B Variable Rate Demand Bonds, backed by a U.S. Bank Letter of Credit; fund the termination payment for an interest rate swap related to the Series 2008B bonds; pay for the cost of issuance; and fund a debt service reserve fund.

Through the bond financing, Eskaton has a more stable capital structure by mitigating common risks associated with Letter of Credit-backed variable rate demand bonds. The corporation also reduced its bank exposure by $43.6 million, or 36% of its outstanding debt. The concurrent termination of Eskaton’s interest rate swap that hedged the 2008B bonds eliminated the counterpart and basis risks, while removing a $9.6 million swap liability from its balance sheet.

The Series 2013 bonds mature in 2035 and were issued in the amount of $51,875,000 at an average yield of 3.96%. 

Oak Grove Capital Closes $1.8 Million Loan for Senior Apartments

Oak Grove Capital recently reports closing a $1.8 million Fannie Mae loan for Fair Oaks Estates, a senior housing complex in Carmichael, Calif. The community offers assisted living, memory care, hospice, and respite care and has above 95% occupancy, according to its website.

Skilled Healthcare Group Receives HUD Loan Commitments

Skilled Heatlhcare Group, Inc. (NYSE:SKH) announced Thursday it has received its first commitments by the Department of Housing and Urban Development to insure loans secured by nine skilled nursing facilities, up to an aggregate amount of $79.8 million.

 ”This is a key step in our efforts to secure long-term low cost financing through participation in the HUD program,” said Boyd Hendrickson, Chairman and CEO of Skilled Healthcare Group.  ”We anticipate that these loans will fund within approximately six weeks.”

SKH plans to use the net proceeds to reduce the term debt portion of its senior secured credit facility. The loans are fully-amortizing over 30-35 years with a projected fixed-rate cost of about 4.6%.

“We have concurrently sought additional HUD loan commitments to approximately match the aggregate $250 million level allowable under our credit agreement, and will evaluate further HUD opportunities under the $460 million portfolio capacity at that time,” Hendrickson said.

The Carlyle Group Seeks $4 Billion Fund Raise

The Carlyle Group, a private equity firm with ties to Capitol Seniors Housing, is looking to launch a U.S. real estate fund and raise up to $4 billion, according to the Wall Street Journal.

“We believed in the inherent value of the investments we were making despite the noise in the market,” Robert Stuckey, head of Carlyle’s U.S. real estate group, told the WSJ without specifically discussing the new fund raise. 

Carlyle has about $176 billion in assets under management. 

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Lancaster Pollard Assisted Kan. CCRC with Bond Refinance

Lancaster Pollard recently assisted Brewster Place Retirement Community, a not-for-profit continuing care retirement community in Topeka, Kan., in refunding an existing bond issue.

The 30-acre CCRC has 229 independent living units, 28 assisted living units and a fully licensed 97-bed skilled nursing facility. Lancaster Pollard developed a credit profile for Brewster Place and solicited an investor that provided the lowest cost of capital with the greatest flexibility.

The organization refunded the existing bonds with a private placement of $10 million in tax-exempt bonds at a fixed interest rate of less than 3.5% for 12 years. Part of the proceeds will be used to finance nearly $2 million in general improvements. Additionally, the existing debt service reserve fund was released and not required for the new bonds. Bill Wilson, senior vice president and regional manager of the firm’s office in Lawrence, Kan., was the lead banker on the transaction.

Love Funding Secures $8.7 Million Loan for Calif. Skilled Nursing Facility

Love Funding recently announced the closing of an $8.7 million loan refinancing for Country Villa Rehabilitation Center, a skilled nursing facility in Los Angeles, Calif.

Senior director Leonard Lucas out of Love Funding’s Boston office, together with Citra Capital Management LLC, secured the loan through the Department of Housing and Urban Development’s Section 232/223(f) LEAN loan program. The loan refinanced existing debt with a low interest rate that is fixed for 26 years. The refinancing provided enough additional proceeds to fund repairs and property improvements. 

Country Villa has 180 beds and is part of the Country Villa Health Services network, a family-owned and operated company that began operations in 1969 and has grown to one of the largest skilled nursing providers in California. 

Cain Brothers Closes $25 Million Bond Issue for Cayuga Medical Center

Cain Brothers announced it has structured and closed $25.0 million of tax-exempt revenue bonds for Cayuga Medical Center, a 190-bed health care facility located in Ithaca, N.Y. The financing consisted of a 10-year fixed rate bank direct purchase used for the purpose of reimbursing various project costs.

On behalf of CMC, Cain Brothers conducted a competitive bid process to determine the bank partner from a group of regional and national banks. Cain Brothers negotiated best and final proposals from all participants. The tailored process allowed CMC to achieve a favorable interest rate, a longer term, favorable security terms, and a reasonable covenant package.

Greystone Originations $28 Million Financing Two Senior Apartment Complexes

Greystone recently announced that it has provided a total of $28 million in bridge loan financing to United Group of Companies Inc., for two market rate senior apartment communities located in New York and Georgia. The loans were originated by Donny Rosenberg, a Managing Director in Greystone’s multifamily lending group, in conjunction with Steve Germano, Managing Director of Greystone’s Portfolio Lending Group.

The loan proceeds were used to refinance existing debt, and Greystone will work with United Group of Companies to provide long-term financing prior to the maturity of the bridge loan.

Schulyler Commons in New York and The Lodge at BridgeMill in Georgia received $28 million of loan proceeds through Greystone’s bridge loan program. Both properties received attractive terms with a new maturity allowing the borrower to execute their business plan.

Berkadia Funds $60 Million Portfolio of SNFs in Arkansas for OHI

Berkadia Commercial Mortgage, LLC recently originated $59.8 million through the Department of Housing and Urban Development’s Section 232/223(a)(7) program to refinance a portfolio of 12 skilled nursing facilities in Arkansas. 

Jay Healy, assistant vice president of Berkadia, worked with borrower Omega Healthcare Investors, Inc. (NYSE:OHI) to secure the financing. 

OHI acquired the assets in December 2011 and assumed HUD debt through a transfer of physical assets from the previous owner. Berkadia closed all 12 loans simultaneously on March 26, 2013. As a result of the portfolio refinance, OHI is realizing approximately $1 million in annual debt service savings. 

The portfolio consists of individual loans ranging from $1.9 million to $9.4 million, spanning more than 1,400 beds.

Ziegler Closes $37.7 Million SNF Portfolio Refinance

Ziegler Financing Corporation, the FHA-insured mortgage lending arm of Ziegler, recently announced the successful closing of the $37,653,300 portfolio refinancing of six skilled nursing facilities, owned and operated by Extendicare Health Services, Inc. 

Extendicare is the U.S. subsidiary of Extendicare Inc. (TSX:EXE), which operates 150 senior care communities nationwide. ZFC assisted Extendicare with the refinancing of their existing facilities located in Michigan, Minnesota, and Wisconsin using FHA’s Section 232/223(f) refinancing program. 

ZFC closed more than $136 million (par amount) of FHA-insured loans in 2010, 2011, and 2012 on behalf of Extendicare. 

LTC Properties Prices Public Offering of 3.5 Million Shares of Common Stock

LTC Properties, Inc. (NYSE:LTC) announced last Friday it priced its underwritten public offering of 3.5 million shares of its common stock at $44.50 per share. LTC Properties has also granted the underwriters a 30-day option to purchase up to 525,000 additional shares of common stock to cover over-allotments, if any.

The Westlake Village, Calif.-based REIT expects net proceeds of about $149 million from the offering, or $171.3 million if the underwriters exercise the overallotment option in full. 

Wells Fargo Securities, KeyBanc Capital Markets, BMO Capital Markets and RBC Capital Markets are acting as joint book-running managers for the Offering. Sandler O’Neill + Partners, L.P., CSCA, J.J.B. Hilliard, W.L. Lyons, LLC, JMP Securities LLC and Sidoti & Company, LLC are acting as co-managers for the Offering.

LTC Properties intends to use the net proceeds from the offering to pay down amounts outstanding under its unsecured line of credit, to fund acquisitions and the current development pipeline, and for general corporate purposes.

The offering is expected to close on May 8, 2013, subject to customary closing conditions.

Cambridge Closes $44.2 Million in Loans 

Cambridge Realty Capital Companies recently announced closing on a $19.8 million FHA-insured HUD Lean loan to refinance Horizon Health and Subacute Center, a 180-bed skilled nursing home in Fresno, Calif.

The fully-amortized, 30-year term loan was arranged for the owner, a California limited partnership, using the HUD Section 232/223(f) funding program.

Hymie Barber, Cambridge’s National Originations Manager and the Managing Director of Catalyst/Cambridge Health Care Finance in Los Angeles, the company’s West Coast affiliate, coordinated the transaction, which was underwritten by Cambridge Realty Capital Ltd. of Illinois.

Cambridge also recently announced it has closed on a $14.4 million FHA-insured HUD Lean loan to refinance Skokie Meadows, a 224-bed skilled and intermediate-care nursing home in Skokie, Ill.

The fully-amortized, 29-year term loan was arranged for the owner using the HUD Section 232/223(a)(7) funding program. Cambridge Realty Capital Ltd. of Illinois underwrote the loan.

The company announced on Thursday the closing of a $7.3 million FHA-insured loan to refinance Burbank Rehabilitation and Healthcare Center, a 188-bed skilled care nursing home in Burbank, Calif.

The 27-year term loan was arranged using the HUD Section 232/223(a)(7) program and was also arranged by Hymie Barber and underwritten by Cambridge Realty Capital Ltd. of Illinois. 

Also on Thursday, Cambridge announced the closing of a $2.7 million loan to refinance Oakley Courts, a 46-bed assisted living facility in Freeport, Ill.

The 35-year term loan was arranged for the owner using the HUD Section 232/223(a)(7) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois. 

Oak Grove Capital Closes $259 MIllion Credit Facility for Brookdale

Oak Grove Capital this week the closing of a $259 million Fannie Mae DUS credit facility for Brookdale Senior Living Inc. (NYSE:BKD). The 10-year, variable-rate facility was used to refinance existing mortgage debt.

“Fannie Mae was very creative in designing a credit facility to accommodate differing maturity dates for Brookdale’s debt and the repayment of tax-exempt bonds on a date certain,” said Bill Kauffman, managing director of Oak Grove Capital’s Seniors Housing and Healthcare Finance Group.

Brookdale Senior Living used the new debt to refinance existing loans for 23 different properties, totaling 1,781 units. The collateral pool consists of assisted living, independent living and memory care units located in 10 states, including Florida, New York, Kansas, Pennsylvania and Texas.

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Capital One Closes $19.5 Million Loan for Revera Health Systems

Capital One Bank announced on Monday it had provided a three-year, $19.5 million secured term loan to Revera Health Systems, Inc., a long-term care and rehabilitation provider with multiple skilled nursing centers across the U.S.

Proceeds of the loan were used to refinance existing senior debt on eight of the health system’s skilled nursing facilities in Maryland, New Hampshire, New Jersey, and Vermont. Revera Health Systems also expanded its relationship with Capital One Bank to include despots and treasury management services. 

RED CAPITAL GROUP Closes Acquisition Financing for Ariz. Senior Care Community
 
RED CAPITAL GROUP, LLC recently closed a bridge-to-FHA financing solution for the acquisition of Prescott Nursing and Rehabilitation Center and Boulder Gardens Assisted Living, a 109-bed skilled nursing and assisted living community in Prescott, Ariz.
 
The property, formerly known as Meadow Park Care Center and Peppertree Square, was purchased by an affiliate of Pioneer Health Group, an Arizona-based long-term care community owner and operator.
 
Red Capital Partners, LLC, RED’s proprietary lending arm, closed a $5.96 million bridge loan to finance the acquisition, which closed in December 2012, to accommodate the seller’s closing deadline.
 
At the same time of the bridge financing, Red Mortgage Capital, LLC, RED’s mortgage banking arm, processed a $6.88 million FHA Section 232/223(f) loan, which closed in February 2013, to refinance RED’s bridge loan, fund capital improvements, and provide low fixed-rate, non-recourse permanent financing for the buyer. 
 
Lee S. Delaveris, director of Red Mortgage Capital, LLC, was the lead banker on the transaction. 
 
Cain Brothers Structures $35.5 Million Bond Issue for N.Y. ALF Project
 
Cain Brothers recently structured and closed a $35,515,000 tax-exempt fixed-rate bond issuance for The Hamlet at Wallkill, a 200-bed new construction assisted living community project in Wallkill, N.Y.
 
The FilBen Group, a for-profit developer, owner, and operator of assisted living and skilled nursing facilities, hired Cain Brothers to serve as sole underwriter on the unrated financing for the development and construction of a start-up assisted living community. 
 
The Hamlet at Wallkill will provide high-quality assisted living services to private pay and Medicaid-eligible seniors, in addition to memory care. 
 
Cain Brothers and FilBen used private activity bonds, which are subject to volume cap restrictions, in order to obtain tax-exempt financing at attractive rates. 
 
“Volume cap allotments are awarded on an annual basis; therefore any private activity bonds subject to volume cap requirements must be issued by December 31 of the allotment year,” said Cain Brothers. “Because the necessary volume cap was secured too late in 2012 to market the bonds on a permanent basis before year end, Cain Brothers implemented a strategy that employed a short-term financing mechanism with a three-month mandatory tender. This financing structure preserved the allotted volume cap and allowed long-term capital providers ample time to analyze the project, conduct site visits, and meet with the FilBen management team.”
 
The bonds were remarketed in February 2013, and Cain Brothers was able to secure long-term financing at an attractive cost. Construction is slated to begin in April 2013, with full stabilization expected to occur in Summer 2016.
 
Lancaster Pollard Closes $7.5 Million Loan for Ohio Memory Care Center
 
Lancaster Pollard recently closed two loans totaling $7.5 million to refinance Alois Alzheimer Center in Cincinnati, Ohio.
 
The Health Care Management Group owns and operates the memory care community, which opened in 1987. Lancaster Pollard refinanced the center’s two existing FHA-insured loans with HUD’s non-recourse Section 232/223(a)(7) mortgage insurance program, helping The Health Care Management Group realize more than $103,000 in annual debt service savings.
 
Kass Matt, senior vice president and regional manager at the Ohio-based firm, was the lead banker on the transaction. 

Grandbridge Seniors Housing Closes $5.3 Million Loan for Wash. Community

Grandbridge Real Estate Capital’s Seniors Housing Group recently closed a $5.3 million loan to refinance Highgate Senior Living, a 48-unit assisted living community in Yakima, Wash. Grandbridge facilitated the long-term, fixed-rate loan through Fannie Mae. 

Grandbridge Closes $12 Million Loan for Senior Living Community

Grandbridge’s Seniors Housing Group also recently closed a $12.25 million short-term loan for the acquisition and renovation of Quail Park, a 49-unit assisted living and memory care community in Eugene, Ore.

The loan was through BB&T Bank to allow the community, managed by Living Care, to be repositioned for permanent financing. 

Brookdale Modifies Corporate Line of Credit

Brookdale Senior Living (NYSE:BKD) announced on Wednesday it had modified its existing revolving credit facility with GE Capital, Healthcare Financial Services.

The modification extended the maturity date of the facility to March 31, 2018 and decreased certain costs associated with the facility, along with providing options to increase the committed amount initially from $230 million to $250 million, and then from $250 million up to $350 million. 

The interest rate payable on advances has been decreased through the modification, reducing the LIBOR floor by 1.5% and the spread by 1.25% and reducing the fee payable on the unused portion of the facility from 1.0% to 0.5% per year.

Brookdale secures the revolving credit facility by first priority mortgages on some of its communities. Availability under the revolving credit facility will vary from time to time as it is based on borrowing base calculations related to the appraised value and performance of the communities securing the facility. 

RED Completes 60 Seniors Housing Transactions Worth $460 Million in 2012

RED CAPITAL GROUP, LLC announced last Friday that its banking arm, Red Mortgage Capital, LLC was the top originator for FHA/Ginnie Mae loans in 2012, providing 231 FHA loans totaling $2.176 billion.

During the year, the firm completed 330 transactions totaling more than $3.3 billion in capital to the multifamily, affordable, student, and seniors housing and healthcare industries, representing a 40% increase compared to the previous year’s total number of transactions, and a 13% increase in volume. 

Of the 330 total transactions, 60 were for seniors housing and healthcare deals in 2012, amounting to $460 million.

NorthStar Realty Originates $11.25 Million Loan for Calif. Senior Housing Campus

NorthStar Realty Healthcare recently announced it had originated an $11.25 million senior loan for a senior housing campus in Madera, Calif. The community, built in 2006 and operated by Integral Senior Living, has 112 units offering independent living, assisted living, and memory care. The loan has a 3-year term with an 8% interest rate.

Health Care REIT Announces Conversion Option for 3.00% Notes

On Tuesday, Health Care REIT, Inc. (NYSE:HCN) notified holders of the $494.4 million outstanding principal amount of its 3.00% convertible senior notes due 2029 that they are entitled to convert all or a portion of their Notes into cash and, if applicable, shares of the company’s common stock.

Holders’ right to convert begins on April 9, 2013 and ends at the close of business on July 9, 2013. The notes are convertible because the closing price of shares of the company’s common stock, for at least 20 trading days during the 30 consecutive trading-day period ending on March 31, 2013, was greater than 120% of the conversion price in effect on March 31, 2013.

Love Funding Closes $4.71 Million Loan for Senior Apartment Complex

Love Funding announced on Thursday the closing of a $4.71 million loan refinancing for Porthaven Manor, a 102-unit, age-restricted apartment community in Port Huron, Mich.

Bruce Gerhart, Love Funding’s Midwest regional director, secured the financing through the Department of Housing and Urban Development’s Section 232/223(f) loan insurance program. 

Porthaven Manor, built in 1989 with low-income housing tax credits administered by the Michigan State Housing Development Authority, is restricted for adults aged 62 and older and is required to set aside 20% of its units for income-qualified residents that pay below-market rents. 

The refinancing allows the property’s owners to pay off Boston Financial Institutional Tax Credits, which financed the tax credits. 

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Lancaster Pollard Closes $63.4 Million Refinance for Trilogy Health Services

Lancaster Pollard recently closed on a $63.4 million portfolio refinance for Trilogy Health Services, LLC, which operates multiple senior care communities throughout Kentucky, Illinois, Indiana, Ohio, and Michigan. 

The transaction refinanced eight of Trilogy’s facilities, comprising a total of 568 skilled nursing beds and 340 assisted living units. 

Lancaster Pollard first obtained bridge financing for Trilogy to purchase the real estate associated with the eight leased properties as part of the refinancing structure. The firm then recommended using the FHA Section 232/223(f) program to refinance the bridge debt to take advantage of the federal program’s low fixed rates and achieve significant cash flow savings compared to their former lease payments. 

The firm was able to originate eight non-recourse FHA Section 232/223(f) mortgages with matching term/amortizations of 35 years. The transaction also bolstered Trilogy’s long-term maintenance needs by establishing a well-funded replacement reserve escrow account. 

Sabra Expands New Dawn Relationship With $12.8 MIllion Loan Origination

Sabra Health Care REIT, Inc. (NASDAQ:SBRA) announced on Monday it had entered a $12.8 million mortgage loan agreement with an affiliate of New Dawn Holding COmpany, secured by a first trust dead on a 48-unit memory care facility in Sun City west, Ariz. 

The loan has a 5-year term and bears interest at a fixed rate of 9.0% a year. The loan cannot be prepaid during the first three years of the loan term.

Beginning April 2014, Sabra has an option to purchase the facility that secures the Sun City West mortgage loan for a price equal to the greater of (a) the annualized EBITDAR for the trailing three months prior to option exercise, divided by an EBITDAR coverage ratio of 1.3 and further divided by an implied lease rate of 8.25% (subject to adjustment up to 9.00%), and (b) $16 million.

If Sabra does exercise the purchase option, the REIT would expect to enter a long-term lease with New Dawn affiliates with an initial cash yield consistent with the lease rate used to determine the option exercise price.

The memory care facility was built in 2012 and is operated by affiliates of New Dawn. Sabra funded the loan with available cash. 

Beech Street Capital Closes $6.1 Million in Loans for Two Senior Care Facilities

Beech Street Capital, LLC recently announced the closing of $6.1 million in loans used to refinance a portfolio of two assisted living communities, one in Wheeling, Ill. and the other in Northville, Mich.

The portfolio has a total of 88 units and exclusively care for residents with memory impairments. 

Joshua Rosen, executive vice president of Beech Street, origination the transaction out of the firm’s Chicago office. 

“We were able to achieve significant debt service savings for the borrower on both properties, which will allow them an opportunity to deploy excess capital into other opportunities that may arise,” said Rosen.

Beech Street was also able to extend the term of the Harbor House loan.  

HFF Gets National Seniors Housing Designation from Freddie Mac

HFF announced Tuesday that it had been approved for a National Seniors Housing Designation effective February 1st from Freddie Mac.  HFF is now authorized to sell and service conventional loans secured by multifamily seniors housing properties nationwide.

Cain Brothers Advises Riverside for $75 Million Bond Placement

Cain Brothers served as financial advisor to Riverside Health System in connection with a private placement of $75 million revenue bonds, which closed on Dec. 20, 2012. 

Newport News, Va.-headquartered Riverside is an integrated health system that includes acute care hospitals, senior housing communities, and nearly 500 employed physicians and advance practice providers.

The borrowing proceeds were used to fund capital improvements at Riverside’s flagship hospital, Riverside Regional Medical Center.

Cain Brothers negotiated a 10-year fixed rate direct bank placement with PNC Bank and was able to secure an attractive cost of capital without any adjustments to Riverside’s existing security package, the investment banking firm announced. 

Ensign Doubles Revolving Credit Facility to $150 Million

The Ensign Group, Inc. (NASDAQ:ENSG) announced on Wednesday that the company and its operating subsidiaries had increased its revolving credit facility from a six-bank lending consortium arranged by SunTrust Robinson Humphrey, Inc. and Wells Fargo Securities, LLC by $75 million to an aggregate of $150 million, $20 million of which was drawn as of Feb. 1, 2013. 

The proceeds of the credit facility will be used to fund acquisitions, renovate and upgrade existing and future facilities, cover working capital needs, and for other corporate purposes.  Ensign’s current net-debt-to-EBIDTAR ratio is 2.34x. 

Ziegler Closes $71.25 Million Financing for ABHOW & The Terraces at Los Altos

Ziegler recently announced the closing of the $71.25 million fixed-rate, Series 2013 Bond issue for American Baptist Homes of the West’s (ABHOW) Obligated Group.

Proceeds will fund a major redevelopment of The Terraces at Los Altos, ABHOW’s first community, which opened in 1949 on about 6.3 acres in Los Altos, Calif. The Series 2013 Bond proceeds will be used to pay retain costs of the redevelopment, expansion, and operation of the community (other ABHOW funds were used for project costs up to the date of issuance of the Series 2013 Bonds), fund debt service reserve funds for each series, pay a portion of the interest on the Series 2013 Bonds during construction of the approximately 36-month project, and pay certain costs relating to the issuance of the Series 2013 Bonds.

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Berkadia Originates $14.4 Million Acquisition Loan for Chevalier

Berkadia Commercial Mortgage LLC recently originated a $14.4 million, three-year floating rate acquisition loan to finance Chevalier International Holdings Limited’s acquisition of an 18-property portfolio of assisted living communities operated by Meridian Senior Living.

Christopher Fenton, vice president at Berkadia, arranged the loan through the firm’s proprietary lending group and worked with fellow lender GE Capital Healthcare Financial Services to help finance the acquisition. In the process, they retained the right to refinance the full $89.5 million loan through HUD.

The loan closed on Dec. 21, 2012.

Oak Grove Originates $4.2 Million Loan for Ala. Senior Care Community

Oak Grove Capital recently announced the closing of a $4,192,000 loan for Country Cottage in Montgomery, an assisted living community in Montgomery, Ala. The loan closed on Dec. 17, 2012 and was originated through HUD’s Section 232/223(f) loan program. 

Centerline Capital Refinances Wisc. Senior Housing Property with $4.05 Million Loan

Centerline Capital Group, a subsidiary of Centerline Holding Company, announced on Tuesday it had provided a $4.05 million Fannie Mae Affordable Preservation loan facility to refinance a senior housing property in Stoughton, Wisc.

Rosewood Apartments is an age-restricted affordable senior housing complex with 90 units. At closing, the property was outside of the 15-year tax credit compliance period, but within the 15-year extended-use compliance period. Portions of the proceeds from the cash out refinancing will be used to pay off existing hard debt and unsecured debt held by Centerline Capital Group. 

Stoughton Senior Housing Limited Partnership is the borrower. 

HJ Sims Advices Senior Living Provider on $120 Million Debt Restructuring

HJ Sims provided advisory services to Pacific Retirement Services, a Medford, Ore.-based senior living organization that owns, operates, and/or manages more than 50 communities primarily on the West Coast to restructure construction debt for a Seattle, Wash. continuing care retirement community.

Construction and development of Mirabella, the downtown Seattle CCRC, be can in 2006 and was financed with $256 million in tax-exempt variable rate bonds backed by a letter of credit issued by HSH Nordbank AG with participation from five other banks.

Even though it was being developed during the economic downturn, nearly 60% of the community’s 290 independent living units were filled within Mirabella’s first year of operation, with the first residents moving in by December 2008.

However, the fill-up pace wasn’t sustainable as Seattle real estate values were declining sharply and there was a spike in local unemployment, says HJ Sims, and the community needed to make “significant changes” to its entrance fee pricing structure. Also, because units were selling slower than originally expected, more working capital was needed compared to what had been budgeted for the initial lease-up timeline.

These and other factors led to restructuring the community’s debt in December 2012. Beginning in mid-2012, HJ Sims began negotiations on a fixed-rate bond financing to provide Mirabella with a stable, long-term capital structure and repay the lending banks a “significant” portion of the existing debt.

The final, agreed-upon structure repaid the banks about 74% of the outstanding debt at the time of the December refinancing, in addition to the $138 million that was repaid to that point with initial entrance fees. The banks received $30.8 million in long-term subordinated notes for the remaining amount of the existing debt. 

Lancaster Pollard Obtains $10.9 Million Loan for Tex. Senior Care Facility

Lancaster Pollard recently obtained a $10.9 million loan to refinance all the outstanding debt of a Texas nursing home and assisted living facility. 

The financing was secured through the FHA Section 232/223(f) insured loan program and has a 35-year term and low interest rate. Lancaster Pollard structured the non-recourse loan so that no cash was required at closing, and used its trading desk’s capabilities to incorporate a prepayment structure with no penalties after a five-year period, allowing ownership to maintain flexibility for future business decisions.

Bill Wilson, senior vice president and regional manager of Lancaster Pollard’s Lawrence, Kan. office, led the transaction.

Lancaster Pollard Closes $4.8 Million Refinancing for Ga. Senior Apartments

Lancaster Pollard recently closed a $4.8 million loan to refinance Cathedral Towers, a Section 202 property in Atlanta, Ga., led by Gerald Swiacki, senior vice president and regional manager out of the firm’s Atlanta office.

The loan was insured by the FHA Section 232/223(f) program, and the transaction provides for more than $1 million in repairs and improvements along with paying the organization a developer’s fee of approximately $650,000. Lancaster Pollard also assisted Cathedral Towers in obtaining a rent increase, as the project had been operating with below-market rents. 

The firm was also able to avoid the new FHA requirements for Section 202 refinance projects for a 20-year extension of the affordable housing use agreement.

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Sunrise Announces Changes to 5.00% Junior Notes

Sunrise Senior Living, LLC announced Friday that in connection with the closing of the transactions by among Health Care REIT, Sunrise Senior Living, Brewer Holdco, Inc., Brewer Holdco Sub, Inc., and Red Fox, Inc., Sunrise delivered a notice to holders of its 5.00% Junior Subordinated Convertible Notes due 2041, pursuant to the April 20, 2011 indenture by and between Sunrise and the Bank of New York Mellon Trust Company, N.A., as trustee, of the Make-Whole Fundamental Change that occurred in connection with the completion of the transactions. The effective date of the Make-Whole Fundamental Change was Jan. 9, 2013.

The consideration due upon conversion of the notes will be cash equal to $1,443.67 per $1,000 principal amount of notes based on a conversion rate of 116.4251 in the case of a holder that elects to convert its notes in connection with a Make-Whole Fundamental Change, or cash equal to $1,338.12 per $1,000 principal amount of notes based on a conversion rate of 107.9130 in the case of a holder that elects to convert notes other than in connection with a Make-Whole Fundamental Change. Holders who wish to convert their notes must satisfy the requirements set forth in the April 2012 indenture.

Holders that don’t convert their notes during the Make-Whole Conversion Period (between the period beginning Jan. 9, 2013 to the business day immediately prior to the related Fundamental Change Purchase Date, which will be specified to holders and will be between 20-35 days following the date of the Fundamental Change Company Notice) and thus aren’t converting notes in connection with the Make-Whole Fundamental Change may convert their notes at any time prior to the close of business on March 29, 2041, the business day immediately preceding the maturity date of the notes. 

Capital One Leads Closing of $168.8 Million Secured Term Loan for SNF Acquisition

Capital One Bank announced on Tuesday it and arranged a $168.8 million five-year term loan for a healthcare real estate entity to facilitate the acquisition of a 25-property portfolio of skilled nursing facilities in Alabama, Florida, and Mississippi. Capital One Bank acted as the lead agent on the financing, providing a $63.8 million secured term loan. 

The portfolio was acquired by a newly-formed, privately-held entity and have been triple-net leased to affiliates of Gulf Coast Healthcare, LLC. The portfolio has more than 3,200 beds and offer skilled nursing and long-term care services including physical therapy, occupational therapy, speech therapy, dietary management, pain management, and Alzheimer’s care, among other rehabilitation treatments. 

Senior Housing Properties Trust Prices Public Offering of 10 Million Shares

Senior Housing Properties Trust (NYSE:SNH) announced on Wednesday that it had priced a public offering of 10 million common shares at $23.80 per share, and have granted underwriters a 30-day option to purchase up to an additional 1.5 million shares. 

The proceeds from the offering are expected to be used to repay amounts under its revolving credit facility and for general business purposes, including new acquisitions. The settlement of this offering is expected to occur on Jan. 28, 2013. 

Jefferies, Citigroup, and Wells Fargo Securities are joint bookrunning managers for this offering, with BofA Merrill Lynch, Morgan Stanley, RBC Capital Markets, and UBS Investment Bank as joint lead managers. The co-managers are BB&T Capital Markets, Janney Montgomery Scott, JMP Securities, and Oppenheimer & Co. 

Chartwell Announces Name & Logo Change

Chartwell Seniors Housing Real Estate Investment Trust (TSX:CSH.UN) announced on Friday that it has changed its name to Chartwell Retirement Residences, although it will continue to trade on the Toronto Stock Exchange as CSH.UN. The change is timed to coincide with the rebranding of the 42 retirement communities Chartwell acquired with Health Care REIT (NYSE:HCN) in May 2012.

The new name makes way for a more consistent translation in French to Chartwell Résidences Pour Retraités, says the REIT. In Ontario, long-term care communities will be branded distinctively as Chartwell Long Term Care Residences, and communities will begin reflecting the new name and logo as part of a national roll-out strategy throughout 2013. 

Beech Street Capital Closes $15.9 Million Refinance for Seattle Senior Living Community

Beech Street Capital, LLC announced recently it had closed a $15.9 million loan to refinance an independent and assisted living community in Newcastle, Wash. near Seattle.

With the maturity date approaching for Regency Newcastle, a 99-unit community, time was of the essence to close the refinancing, so Beech Street recommended that the borrowers pursue a Fannie Mae conventional senior housing loan and was able to close the transaction before the deadline will securing an attractive interest rate. 

The fixed-rate loan has a 10-year term, with 9.5 years yield maintenance and a 30-year amortizing schedule. James Sherman, Beech Street’s executive vice president of seniors housing, originated the transaction. 

Beech Street Announces $4 Billion Financing Activity in 2012

Beech Street Capital also announced that it provided $4.0 billion in multifamily financing in 2012—only its third year of operation—achieving a 100% annual growth rate for the last two years. “

We were determined this year to demonstrate that we could maintain our momentum,” says Grace Huebscher, Beech Street’s president and CEO. “Thanks to our growing relationships with Fannie Mae, Freddie Mac and FHA, the support of our customers, and the determination of our team to deliver on every single transaction, we succeeded.”

Beech Street saw significant growth across its business, with Fannie Mae financing growing 150% and the Freddie Mac business tripling. The financing firm also saw a surge in its FHA business. At year end, Beech Street’s servicing portfolio consisted of 643 loans and more than $7.3 billion.

Lancaster Pollard Closes $11 Million Loan for Florida CCRC

Lancaster Pollard was recently engaged by Epworth Village Retirement Center in Hialeah Fla. to realign the CCRC’s capital structure and develop a recapitalization plan to pay off two existing loans from the Department of Housing and Urban Development as well as to fund $1.4 million in repairs and improvements. 

The Columbus, Ohio-based financing firm selected a capital partner based on the ability to deliver the lowest cost and greatest flexibility for the $11 million loan, which has an interest rate nearly 4% lower than the previous blended coupon. This significantly decreases the overall interest expense for the CCRC.

Gerald Swiacki, senior vice president with Lancaster Pollard’s Atlanta office, headed the transaction. 

Mass Development Issues $3 Million Bond for CCRC

MassDevelopment has financed the expansion of a Longmeadow, Massachusetts continuing care retirement community with the issuance of a $3 million bond, according to the Banker & Tradesman

The bond was issued on behalf of Glenmeadow, Inc., a nonprofit CCRC that intends to use the proceeds to renovate its main building by updating public and office spaces, building an additional dining venue, expanding wellness activities space, and improving common areas.

People’s Bank purchased the bond. 

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Sunrise Stockholders Approve Acquisition by Health Care REIT, Completed Jan. 9

Sunrise stockholders voted at a special meeting on Monday to approve the company’s previously-announced merger with Health Care REIT, Inc. (NYSE:HCN). A majority (98.3%) of the votes case by Sunrise stockholders were in favor of this proposal, representing 69.4% of the shares of common stock entitled to vote.

Sunrise stockholders received $14.50 per share from the merger, which includes a $2.10 special dividend. 

On Jan. 9, HCN and Sunrise announced the completion of the acquisition, an investment valued at $3.4 billion and expected to increase to $4.3 billion by July 2013 as the REIT continues to exercise rights to acquire additional joint venture partner interests at fixed purchase prices. 

Health Care REIT expects the $4.3 billion acquisition to generate a 6.5% unlevered initial yield, or 6.1% after capital expenditures.

Health Care REIT Announces Closing of $2.75 Billion Credit Facility

Health Care REIT, Inc. (NYSE:HCN) announced on Tuesday the closing of a $2.75 billion unsecured credit facility consisting of a $2.25 billion revolver and a $500 million term loan to be funded the same day. The facility replaces the company’s existing $2.0 billion unsecured revolving credit facility. 

The new revolver matures on March 31, 2017 and can be extended for an additional year at the company’s option. The term loan matures on March 31, 2016 and can be extended up to two years at the company’s option.

Based on HCN’s current credit ratings, the revolver bears interest at LIBOR plus 117.5 basis points and has an annual facility fee of 22.5 basis points. The term loan bears interest at LIBOR plus 135 basis points. HCN has an option to upsize the facility by up to an additional $1 billion through an accordion feature, allowing for aggregate commitments of up to $3.75 billion. The facility also allows for the company to borrow up to $500 million in alternate currencies.

HCN will use proceeds from the credit facility to fund announced investment activity for general corporate purposes including investing in health care and senior housing properties.

Merrill Lynch, Pierce, Fenner & Smith Incorporated and J.P. Morgan Securities LLC arranged the facility as joint book runners and joint lead arrangers. Bank of America, N.A. and JPMorgan Chase Bank, N.A. were co-syndication agents. KeyBanc Capital Markets Inc. was a joint lead arranger and KeyBank National Association was Administrative Agent. Deutsche Bank Securities, Inc. served as a joint lead arranger and documentation agent. 

GE Capital Agents Credit Facilities of $725 Million for Genesis/Sun Healthcare Deal

GE Capital, Healthcare Financial Services, is serving as administrative agent on a $400 million asset-based revolving credit facility, and as syndication agent on a $325 million cash flow term loan credit facility for Genesis HealthCare, being used to support the acquisition of Sun Healthcare Group, Inc.

GE Capital Markets served as joint lead arranger and sole book runner for the revolving loan and joint lead arranger and joint bookrunner on the term loan.  

Lancaster Pollard Has Record Year, $946.8 Million of Senior Housing Financing

Lancaster Pollard finished its record year with 190 closed transactions with a total loan amount of $1.4 billion. Of those transactions, 132 were in the seniors housing sector, totaling $946.8 million. The firm financed skilled nursing facilities, assisted living facilities and CCRCs in 28 states and primarily used HUD funding through FHA Sec. 232/223(f), FHA Sec. 232/223(a)(7) and FHA Sec. 232/241 programs. However, the firm also financed facilities using the Fannie Mae Seniors Housing program and privately placed tax-exempt bonds.

Lancaster Pollard Provides $6.1 Million Financing for Utah Senior Care Center

Lancaster Pollard recently announced the closing of a $6.1 million loan used to refinance Abbington Manor, a 79-unit assisted living and memory care community in Lehi, Utah.

Wentworth Senior Living Services manages Abbington Manor, which consists of two separate sites located about two miles apart.

The borrower was seeking to refinance its existing loan to take advantage of current low interest rates, benefit from debt service savings, and fund various critical repairs. Although the Abbington Manor has two separate sites, the borrower wanted to demonstrate that the sites comprised one community so it could get one loan and reduce closing costs.

HUD agreed that the two sites shared enough common resources and management to qualify as one operation, and Lancaster Pollard was able to obtain the loan using the FHA Section 232/223(f) program. The borrower will benefit from more than $95,000 in annual debt service savings with the new low interest rate and 30-year term. Additionally, the refinance will fund significant renovations associated with accessibility and safety for the community’s residents. 

Major repair items include seismic retrofitting, a fire suppression system, and a resurfaced parking lot. The borrower will also be able to make a “substantial” deposit to its replacement reserve, says Lancaster Pollard. 

HJ Sims Provides Capital for Senior Housing Acquisition

Herbert J. Sims & Co., Inc. through its affiliate HJ Sims Investments, LLC, provided financing to Watermark Retirement Communities, an affiliate of The Freshwater Group, to acquire a senior living community in Oregon. 

The finance plan included a first mortgage loan from Freddie Mac in addition to equity from a joint venture between The Freshwater Group and Prudential Real Estate Investors—10% of which needed to be provided by either TFG or a co-investment partner. 

Sims was able to structure a preferred equity investment that worked with an existing joint venture agreement between TFG and Prudential in time to close with a Freddie Mac first mortgage/bridge-to-agency senior loan.

A new entity, Fountains Acquisition Finance I, LLC was formed to issue taxable bonds, says Sims, the proceeds of which were used to make the equity investment in a new TFG/Sims partnership, which in turn invested in the joint venture with Prudential to complete the transaction. 

The bonds were structured to have a low current interest rate that grows as the cash flow improves, allowing most of the community’s current operating cash flow to be retained to further the revenue enhancement plan. 

Lancaster Pollard Refinances Hoosiers Care Portfolio for $39 Million

Columbus, Ohio-headquartered Lancaster Pollard recently refinanced seven not-for-profit skilled nursing and pediatric facilities in Indiana and Illinois owned by Indiana-based Hoosiers Care, Inc., and managed by Exceptional Living Centers of Lexington, Ky.

The refinanced facilities are:

  • Exceptional Living Center of Brazil in Brazil, Ind.
  • Randolph Nursing Home in Winchester, Ind.
  • Richland Bean-Blossom Health Care Center in Elletsville, Ind.
  • Vernon Manor Children’s Home in Wabash, Ind.
  • Exceptional Care and Training Center in Sterling, Ill.
  • Swann Special Care Center in Champaign, Ill.
  • Walter J Lawson Children’s Home in Loves Park, Ill. 

Lancaster Pollard recommended that the owner use the FHA Section 232/223(f) program to refinance Hoosier Care’s tax-exempt bonds with 30-year, fully-amortizing, fixed-rate mortgage loans totaling $39 million. The transaction resulted in millions of dollars in annual debt service savings and also served to fund more than $1.5 million in replacement reserves and $141,000 in repairs and improvements across the portfolio.

The firm’s Steve Kennedy, senior vice president and regional manager, and Chris Blanda, vice president, led the team on the refinancing. 

Oxford Finance Provides $20 Million Financing to Senior Living Provider

Oxford Finance LLC recently announced the closing of a $16 million senior secured term loan and $4 million revolving line of credit with American Senior Living Communities.

Proceeds of the term loan were used to refinance two skilled nursing facilities in Rhode Island, while the revolver will be used to fund ongoing working capital needs at the two sites. 

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Ventas Sells $925 Million of Senior Notes

Ventas Inc. (NYSE:VTR) subsidiaries Ventas Realty, Limited Partnership and Ventas Capital Corporation recently announced the issuance and sale of $700 million aggregate principal amount of its 2.00% senior notes due 2018 and $225 million principal amount of their 3.25% senior notes due 2022. View the 8-K

Cambridge Closes $10.8 Million Loan for Fla. Senior Care Community

Cambridge Realty Capital Companies recently closed a $10.8 million loan to refinance Hawthorne Inn of Ocala, a 156-bed skilled nursing and assisted living facility in Ocala, Fla.

The fully-amortized, 30-year term loan was refinanced for the borrower using HUD’s Section 232/223(f) funding program and underwritten by Cambridge Realty Capital Ltd. of Illinois. 

Lancaster Pollard Obtains $14.3 Million Loan for Neb. Senior Care Facility

Lancaster Pollard recently obtained a $14.3 million loan to refinance Hillcrest Health & Rehabilitation, a Bellevue, Neb. senior care facility built in the 1960s and owned by Hillcrest Health Systems.

Hillcrest used the FHA-insured HUD Section 232/223(f) program to complete the financing, which allows for a refinance with moderate repairs and improvements of up to 15% of appraised value. The loan has a 35-year term that allows Hillcrest to meet its goals of improving the facility. The owner was able to finance a $3.2 million renovation and expansion, and will also benefit from debt service savings of more than $275,000 per year. 

The renovation and expansion project includes a new outpatient rehabilitation area, additional private rooms, and other improvements. 

Cain Brothers Arranges $9 Million Loan for Calif. ALF

Cain Brothers Funding recently arranged an $8,976,000 taxable loan insured under the FHA Section 232/223(f) LEAN program for Eskaton Village Placerville, a 64-unit assisted living facility in Northern California. 

The proceeds of the loan were used to retire existing bonds. The loan has an interest rate of 2.45% for 35 years. 

Cambridge Provides $12.9 Million Loan to Refinance Ill. Senior Care Center

Cambridge Realty Capital Companies has closed a $12.9 million FHA-approved HUD loan to refinance Renaissance Care Center, a 190-bed skilled nursing and pediatrics facility in Canton, Ill. 

The fully-amortized, 37.6-year term loan was used to refinance the borrower using the HUD Section 232/223(a)(7) funding program and was underwritten by Cambridge Realty Capital Ltd. of Illinois. 

Ziegler Closes $64 Million Financing for Nonprofit Senior Services Corporation

Ziegler recently closed a $64,160,000 fixed-rate, Series 2012 Bond issue for Episcopal Communities & Services for Seniors, a California not-for-profit corporation serving seniors in the greater Los Angeles area.

The Pasadena-headquartered corporation owns two continuing care retirement communities (which comprise the Obligated Group), The Canterbury in Rancho Palos Verdes, and The Covington, in Aliso Viejo. 

The Series 2012 Bonds are being issued to refund prior Series 2002 Bonds insured by Cal-Mortgage; fund a debt service reserve; and pay certain costs of issuance. This most recent financing is driven by a desire to create a corporate and capital structure that will facilitate future growth while minimizing current capital costs, as well as to generate annual cash flow savings. 

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