The SeniorCare Investor: Financing News-

September 2012

In mid-August the government announced that Fannie Mae and Freddie Mac would be required to reduce their portfolios by 15% annually, up from 10% annually currently.  Seniors housing represents a small, but profitable, percentage of both agency’s loan portfolios, but it is unclear how this will impact their current loan production.  The market hopes there will be no changes. Berkadia Commercial Mortgage is not letting any of this news disrupt its business.  Berkadia’s Chris Fenton closed a total of $25.8 million in supplemental financing on 11 properties in two separate portfolios with Fannie and Freddie on behalf of Capital Senior Living (NYE: CSU).  In another transaction for Berkadia, Heidi Brunet closed a $39.7 million Fannie Mae transaction to refinance a 195-unit retirement community in Virginia on behalf of Smith/Packet. The 10-year loan has a 70% loan-to-value and a 30-year amortization.  The community, which has independent living, assisted living and memory care units, was developed in 2009 and now has an occupancy rate of 90%.

Aron Will of CBRE Capital Markets closed on a $27.1 million Fannie loan secured by a 188-unit independent living community operated by Brookdale Senior Living (NYSE: BKD) in Houston, Texas.  The all-in interest rate was 2.5% for the 10-year loan.  Will and Matthew Whitlock, CBRE’s two seniors housing debt producers, have closed over $416 million in seniors housing financing across 42 assets in the past 18 months.     

Meanwhile, HUD continues to pick up any slack there may be.  Capital Funding had a strong August, completing seven separate HUD loans for five borrowers in five states. The total loan amount was just over $65 million, or $60,200 per bed, indicating that HUD, just like in the acquisition market, is not afraid of skilled nursing facilities with high values. 

Oak Grove Capital completed a $14.3 million HUD loan for the renovation and construction of a 150-unit assisted living community in Illinois that will serve a physically disabled population. The financing structure combined HUD with tax-exempt bonds that allowed for the sale of low income housing tax credits, which.............Want to read more? Click here for a free trial to The SeniorCare Investor and download the current issue today