CIBC Bank USA closed on a $12.44 million acquisition loan for two skilled nursing facilities totaling 253 beds in northern and central Illinois. An absentee manager had operated the facilities for several years, and occupancy was low as a result. Both facilities had an effective age of roughly 20 years, which is not too old in the SNF market. So, the borrower/buyer saw an opportunity to reduce expenses and bring occupancy to a stabilized level, thereby generating a margin in the mid-teens. One facility will be owner-operated, and the second will be leased to a regional operator. CIBC’s financing included a three-year term loan arranged at 80% loan-to-value, with earn-out potential, plus $1.75 million in line of credit proceeds for working capital. Fritz Kieckhefer and Kyle Doran handled the transaction.
Low Census SNFs Trade Hands in Illinois
