We have written numerous times of property owners not being tempted into the M&A market lately, due to values being below their expectations for their properties. One of those owners, a local operator in Michigan, decided to refinance its 150-unit independent living community after sale offers came in lower than they desired. Built by the same operator 15 years ago about 15 miles outside of Ann Arbor, the three-story community had experienced a census drop of over 20% since the start of the pandemic. That probably did not help its sale prospects.
So, JD Stettin of Carnegie Capital arranged a refinance totaling $9 million from a syndicate of local credit unions. The loan came with a five-year term, fixed at 7%, and is open to prepayment at any time without penalty. Then, maybe, five years from now (or sooner than that) we will be in a seller’s market.
