Heading into the Thanksgiving holiday, Aron Will of CBRE certainly had a bountiful month, closing nearly $80 million in two transactions. First, working on behalf of joint venture partners Harrison Street Real Estate Capital and The Springs Living®, Mr. Will arranged a $66.4 million construction loan to fund the construction of a 216-unit senior living community in Lake Oswego, Oregon (Portland MSA). A pair of national banks provided the floating rate loan, which came with a four-year term and 48 months of interest only. Using a conservative loan-to-value for the project, that would result in a per-unit value most likely above $400,000. The property’s location in one of the most affluent suburbs of Portland definitely adds to its appeal. Upon completion, The Springs Living® will operate the community, which will feature 75 independent living, 117 assisted living and 24 memory care units in five stories.
Then, Mr. Will worked with Focus Healthcare Partners to fund their acquisition of a 99-unit independent living community in Durham, North Carolina. Paying $15.8 million, or about $160,000 per unit, for the property, Focus received a $12.2 million floating rate Fannie Mae loan, with a 10-year term and five years of interest only, to finance the deal. Originally built in 1985 as a hotel, the building was converted to independent living in 2013 thanks to a multi-million-dollar renovation. It is now fully occupied and operates at a 32% margin on approximately $3.13 million of revenues. Mike Pardoll of Marcus & Millichap brokered the deal, which featured a 6.3% cap rate.
