Walker & Dunlop’s $25M Deals; NHI’s $100M Term Loan

Walker & Dunlop last week announced the closure of $25 million in Department of Housing & Urban Development-backed financing for a skilled nursing and supportive living facility.

The Bethesda, Md.-based real estate finance firm provided $10.7 million in financing for the 106-bed Landmark of Laurel Creek, a skilled nursing facility in Manchester, Ky. The property, located 100 miles from Lexington, offers rehab-to-home, wound care, hospice, and respite services.

Walker & Dunlop also landed $14.6 million for The Vistas Fox Valley, a supportive living property in the western Chicago suburb of Aurora, Ill. Providing post-acute care to people aged 65 and older, the facility focuses on hotel-style amenities such as an on-site spa and private suites.

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Both loans were completed through HUD’s refinance program for health care facilities, with Walker & Dunlop senior managing director Joshua Rosen leading the origination team.

NHI’s $100M Term Loan

National Health Investors (NYSE: NHI) last week announced the addition of a one-year $100 million term loan in conjunction with a consortium of banks.

The Murfreesboro, Tenn.-based real estate investment trust (REIT) entered into the loan at an interest rate of 30-day LIBOR plus 1.85%, according to a statement announcing the liquidity move; NHI has an option to extend the maturity date by a year.

Wells Fargo Bank served as the administrative agent, with KeyBank, Bank of Montreal, and Regions Bank as syndication agents; Bank of America, Capital One, and Goldman Sachs Bank were the documentation agents.

A syndicate of eight banks, including Pinnacle National Bank, put up a total of $205 million in commitments.

“We are grateful to all our banking relationships for their very strong show of support for NHI,” chief financial officer John Spaid said in the statement. “The more than two times commitment level we received from our existing bank group continues to demonstrate that NHI’s conservative balance sheet and triple-net operating structure are working well for us as we navigate through the COVID-19 crisis.”

The REIT owns 72 skilled nursing facilities, among other senior housing holdings. At the time of the company’s first-quarter earnings report in May, CEO Eric Mendelsohn was upbeat about the company’s post-acute investments despite the strains of COVID-19.

“We’re on the hunt for skilled nursing,” Mendelsohn said. “I’m a little worried the rest of the world will be in on the secret.”

SLIB Turns Three in Texas

Senior Living Investment Brokerage this past week announced the successful completion of three skilled nursing facilities sales in Texas.

First up, the Glen Ellyn, Ill.-based broker oversaw the $8 million sale of the Bishop Davies Nursing Center in Hurst, Texas, on behalf of an owner-operator looking to exit the industry.

The buyer was an unnamed Louisiana-based operator that plans to boost census at the 161-bed facility, which was 74% occupied at the time of the sale; the property was also enrolled in the state’s Quality Incentive Payment Program (QIPP), through which operators can boost their Medicaid reimbursements by achieving certain quality benchmarks.

SLIB managing director Matthew Alley handled the sale.

“This transaction allowed for the local operator to exit the nursing home industry,” Alley said in a statement. “The deal faced several delays due to concerns with COVID-19, but the buyer closed at the original offer price.”

SLIB and Alley also handled the sale of the 115-bed Wood Memorial Nursing Facility in Mineola, Texas for $7.4 million, the firm announced this past week.

Both the seller and buyer were Texas-based owner-operators; since the time of the facility’s last transaction in 2017, the prior owner was able to increase EBITDAR from $100,000 per year to more than $1 million annually, according to SLIB.

“SLIB was able to obtain a repeat engagement on this facility as we were able to sell it for the buyer three years after the initial transaction closed,” Alley said. “After improving operations and entering the facility into QIPP, the seller was able to generate a solid return.”

Finally, the broker announced the sale of the LBJ Medical Center in Johnson City, Texas for an undisclosed sum. Built in 1989, the facility has 60 beds, with census of 63% prior to the beginning of the COVID-19 pandemic.

The buyer was a regional operator based in the Lone Star State.

“This transaction allowed for the local operator to exit the nursing home industry,” Alley said. “SLIB found a strong buyer that wanted to expand into this smaller market and saw the upside present at the facility.”

Cambridge’s $3.9M HUD Refinance

Cambridge Realty Capital Companies last week announced the provision of a $3.9 million HUD-backed refinance loan for the 115-bed Summer Meadows skilled nursing facility in Longview, Texas.

The Chicago-based Cambridge originated the loan on behalf of the facility’s New York-based owner, with national originations manager Hymie Barber leading the deal.

The loan features a 29-year term, according to Cambridge.

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