News - 2009
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January 30,2009
080580
Red Serves as Sole Advisor to RMI on Sale of 8 Properties and Handles Assumption by SHPT of $50 Million in Fannie Mae DUS® Acquisition Financing
450 Independent Living Units Located in Indiana
Oak Woods Manor
La Porte, Indiana
Red Mortgage Capital, Inc., mortgage banking arm of comprehensive capital provider RED CAPITAL GROUP and the nation’s top Fannie Mae DUS® seniors housing lender in the past several years, recently completed a unique transaction both serving as the Sole Financial Advisor on the sell side of the transaction and handling the assumption of the large portfolio of eight seniors housing loans on the acquisition side.
Red Mortgage Capital, Inc. originally provided financing on the eight loans for the seller, Retirement Management, Inc., first as bridge financing in 2005, followed by Fannie Mae first mortgage financing and subsequently with Fannie Mae supplemental loans. All of the properties are performing well; in fact, their performance today exceeds performance levels at the time the supplemental financing was arranged by Red in 2007.
The new owner of the properties, Senior Housing Properties Trust (NYSE: SNH), acquired the eight communities located in various Indiana cities and assumed the existing $50,360,000 in Fannie Mae debt on the portfolio. The cross-collateralized, cross-defaulted loans mature in 2017. Each of the properties is located in a strong market location relative to competitors, they have good access to retail amenities and acute care services and hospitals, and they have high visibility and curb appeal. SNH is a publicly-traded real estate investment trust (REIT) which operates senior living communities, including independent living, assisted living and skilled care units. At the end of December 2007, the company owned 202 properties located in 32 states.
SNH will lease the properties to Five Star Quality Care, Inc. (NYSE: FVE). Five Star operates senior living communities including independent living, congregate care and assisted living communities and skilled nursing homes. As of December 2007, Five Star operated 161 senior living communities containing nearly 18,000 living units.
Casey N. Moore, Managing Director of Red Mortgage Capital, Inc. said, "Our first hand knowledge of the properties, stemming from our previous lending activity with RMI to provide bridge, first and supplemental financing, gave us a unique ability to arrange the acquisition and help the prospective buyer on the assumption side. We appreciate the opportunity to work with RMI as their Financial Advisor and with SNH on the assumption and loan servicing of the portfolio."
