Bethesda, Maryland – February 1, 2017
Walker & Dunlop, Inc. (NYSE: WD) (the “Company”) announced today that it structured a complex pair of refinance loans totaling $29,788,000 for a continuing care retirement community (“CCRC”) consisting of a skilled nursing facility and an independent and assisted living complex in Boise, Idaho.
This unique financing structure required two different lenders to fund two separate loans for one property with one existing mortgage. Garden Plaza of Valley View and Valley View Skilled Nursing Facility make up the combined CCRC; Fannie Mae financed the independent and assisted living portion and the United States Department of Housing and Development (HUD) placed the debt for the skilled nursing facility.
Walker & Dunlop adeptly navigated the intricate specifications of both HUD’s independent living unit requirements and Fannie Mae’s restrictions on skilled nursing revenue. The Company’s team was able to create a condominium structure to ensure the property qualified for HUD skilled nursing financing as well as a Fannie Mae assisted living and independent living loan. In addition, an equity recapitalization component was included in the Fannie Mae debt.
Senior Vice President, Michael Vaughn, and Vice President, Kevin Giusti, led Walker & Dunlop’s origination team and worked with BrightSpace Senior Living (“BrightSpace”), the Tennessee-based borrower, to place the debt assignments. Mr. Giusti commented, “The financing solutions structured by Walker & Dunlop through HUD and Fannie Mae for a nearly 300-unit single standing Continuing Care Retirement Community brought on many hurdles to overcome. My hat goes off to everyone involved. Through the team’s creativity and hard work, we were able to provide solutions to overcome the hurdles and ensure the borrowers objectives were accomplished.”
Chief Financial Officer for BrightSpace, Greg Echols, said, “The complexity of the structure and timing for this transaction makes it unlikely to be repeated in our company – and perhaps in our industry – but it resolved a unique refinance opportunity for a single legal entity operating independent living, assisted living, and skilled nursing facilities at one location. We are proud to celebrate with our attorneys, lenders, broker, and consultants for what we believe is a ‘once in a career lifetime’ financing achievement.”
The Company structured a $9 million loan with a 35-year, fully amortizing term for Valley View Skilled Nursing Facility using HUD’s Section 232/223(f) program. This program provides lenders with the Federal Housing Administration’s mortgage insurance to protect against losses when refinancing nursing homes, assisted living facilities, and board and care facilities. The CCRC’s skilled nursing component was built in 1986 and consists of 24 private and 40 semi-private units.
The loan executed with Fannie Mae for Garden Plaza of Valley View was $20.8 million with a 10-year term, followed by a 30-year amortization schedule. This portion of the CCRC, containing 142 independent living and 51 assisted living units, was built adjacent to the existing skilled nursing facility in 1992.
Substantial renovations to the CCRC were completed in 2009, including common area upgrades, new roofing, and the addition of a physical therapy building. The campus is centrally located in the state’s most populous county, just minutes from the Boise Towne Square Mall and adjacent to the St. Alphonsus Regional Medical Center.
About Walker & Dunlop
Walker & Dunlop (NYSE: WD), headquartered in Bethesda, Maryland, is one of the largest commercial real estate services and finance companies in the United States providing financing and investment sales to owners of multifamily and commercial properties. Walker & Dunlop, which is included in the S&P SmallCap 600 Index, has over 600 professionals in 28 offices across the nation with an unyielding commitment to client satisfaction.