Helios Healthcare Advisors arranged a $11.63 million refinance for a 191-unit/231-bed portfolio of assisted living and memory care communities in Arkansas on behalf of a regional owner/operator. Spread across four locations in the Ouachita Mountain region of Arkansas and primarily serving a Medicaid population, the portfolio is a sub-set of the borrower’s larger operation. It experienced challenges associated with rising costs and little to no reimbursement rate relief from the Living Choice Medicaid waiver program.
The ask did not pencil out at the time it initially went to market and there was pressure from the borrower’s lender, which had inherited the credit through a recent acquisition. Ultimately, Helios identified a lender that was able to get comfortable with the nuances of the transaction.
Anticipating changes to the reimbursement environment, the borrower engaged Helios, which arranged a refinance with a bridge-to-HUD lender that recognized how the reimbursement shift would affect revenue. The loan was structured as an interest only, 24-month bridge loan, priced at SOFR + 350. In addition to retiring all the existing matured debt, the financing reset the capital structure for the borrower and its principals.
