With decades of experience in providing bridge loans for multifamily and commercial properties, Arbor Commercial Mortgage recently closed on its first bridge loan in the seniors housing industry, from its Arbor Realty Trust‘s bridge loan product line. Jeff Ringwald of Arbor originated the $5.55 million bridge acquisition loan, which featured a three-year term and a floating rate spread 500 to 600 basis points over LIBOR, for Fields Senior Living to purchase an 88-unit independent living community in Medford, Oregon. The community was built in 1984 by Holiday Retirement Corporation and was owned and operated by the original financier for the project.
Occupancy had dropped from near full to 67%, and rents were believed to be 20% below the local market. In acquiring the property, Fields, a third-generation owner/operator of seniors housing facilities across Washington, will look to improve bottom line and increase occupancy with more hand-on management (the seller lived three hours away but managed it himself, living in one of the units during the week).
The bridge loan, in addition to helping fund the $5.6 million (or $63,600 per unit) purchase price, will finance a $1.1 million renovation/reposition of the building. In the plans are a general renovation of the common areas, new carpeting and paint, a new front entrance, landscaping, and a light upgrade to all the units. Chris Urban of Ambrose Capital Group worked with Fields and Arbor to structure and secure the financing.
