Monarch Advisors announced a new loan closing to support the acquisition of a small senior care facility in rural Kansas. Located outside of the Kansas City metro area, the facility was built in the 1960s but renovated around 2000.
It featured 45 skilled nursing beds that were 80% occupied and a six-unit assisted living community with typically full occupancy. It was part of a larger portfolio that was put into receivership by the state of Kansas. A third-party manager was brought it to operate the building profitability, which it did, but the company had no intention of owning the facility.
In comes a local owner/operator, which secured $425,000 in senior debt in the form of an SBA 7(a) loan from a national SBA lender. Alec Blanc of Monarch Advisors structured the loan with a 25-year, fully amortizing term and a five-year declining prepayment penalty. The loan covered 80% of the purchase price but less than 50% of the facility’s appraised value.
