Eastern Union Funding has arranged, alongside Greystone & Co., a $105 million senior loan for the purchase of a $120 million, 1,239-bed senior housing portfolio in Eastern Kentucky on behalf of a New York-based investor-operator.
The portfolio, which comprises 12 skilled nursing facilities and one assisted living facility, is approximately 95 percent occupied and in excellent physical condition.
Phil Krispin, Eastern Union’s director of healthcare finance, and senior loan consultant CJ Danziger, worked with Greystone executive managing director Jonathan Coven to secure the financing from several regional banks in the eastern U.S. The loan includes flexible pre-payment terms to allow for an FHA exit.
“Many lenders are becoming more aggressive in the healthcare arena while others are looking to move into this asset class, which nicely matches the acquisition growth uptick we’re encountering,” noted Krispin, who leads Eastern Union’s healthcare division.
“Both regional and national lenders are keen to put more money out there and are more comfortable with a higher leverage finance structure.”
Interest in these types of transactions have increased so rapidly that Eastern Union’s healthcare division expects to triple its year-over-year production by the end of 2016.
“This portfolio is a great example of a stable portfolio that attracted a sophisticated owner, which can focus on overall operational efficiencies and cost savings to drive a return on investment,” he continued.
“The entire transaction took less than 60 days from start to close because the lenders recognized the time constraints and were eager to work with the right sponsor and operator.”
Eastern Union’s healthcare division is in the process of underwriting several national loans ranging from $10 to $40 million, which are expected to close by year’s end.
Recently, it arranged an $18 million loan to refinance a 200-bed skilled nursing facility in Central New Jersey.