Grace Hill Capital, a real estate capital advisory firm specializing in seniors housing and healthcare that was founded in 2023 by Adam Shealy, served as exclusive financial advisor and placement agent for a bridge loan to refinance and recapitalize a seven-community seniors housing and care portfolio across Georgia, North Carolina and South Carolina. The interest-only bridge loan totaled $46.97 million and was structured with a 36-month term. The portfolio includes a total of 432 units and beds, consisting of 76 independent living units, 250 assisted living units, 59 memory care units and 47 skilled nursing beds.
The transaction enabled the borrower to retire existing debt, complete a limited partner buyout, fund critical repairs, and consolidate ownership, strategically positioning the portfolio for a long-term, fixed-rate HUD takeout in the next 12 to 18 months. It also represented a significant milestone for the borrower, consolidating 100% economic ownership by buying out passive limited partners and streamlining the capital structure ahead of permanent financing.
The financing was structured with HUD 232 execution in mind, aligning sizing, reserves and eligibility with agency requirements from the outset. This included establishing legal structures aligned with HUD requirements, ordering third-party reports to HUD specifications, and funding critical repairs that will need to be completed ahead of the HUD application. The borrower also implemented cash management and account structures consistent with HUD protocols to ensure a streamlined transition to permanent financing. By facilitating the limited partner buyout and eliminating legacy debt, the recapitalization streamlines the ownership structure and enhances sponsor control as the portfolio transitions to long-term, fixed-rate financing. That is some good preparation (and advice from their exclusive financial advisor).
