Cushman & Wakefield facilitated the sale of a seniors housing community in Cincinnati, Ohio. Built in 2022, Airy Hills at North Bend Crossing features 50 assisted living and 32 memory care units. However, the community was never opened due to foreclosure on the construction borrower. In 2019, Northmarq secured $18.2 million of construction debt from a regional bank, with a three-year, interest-only loan. In addition, the project received $5.5 million of PACE equity and another $5.3 million of equity to round out the capital stack.
It did not help that the community sits adjacent to the 121-unit Wellington at North Bend Crossing Community that was developed by the same entity. Sonida Senior Living had purchased that community in 2016 for $29 million, and it is now purchasing Airy Hills to create one continuum of care campus. That makes sense and prevents another provider from coming in and competing for residents and staff just next door.
Paying a price of $16.3 million, Sonida funded the transaction with $18.25 million of seller-financing, including $2.0 million for capital expenditure investment into the facility (primarily FFE), which is expected to be utilized prior to the targeted mid-2025 opening. The non-recourse mortgage carries an 84-month term and 24-month interest waiver to support lease-up and stabilization, with a 3% fixed interest-only rate thereafter. So, the PACE equity was refunded, and we imagine the previous senior debt holder received the remaining proceeds.
Jason Skalko, Mike Sullivan and Joe Janszen of Cushman & Wakefield handled the transaction, which closed before year end.
