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Freddie Mac purchases $140 million mortgage pool for senior housing.

Freddie Mac announced it has purchased a $140 million pool of mortgages, consisting of seven senior housing properties across four states, from Capmark Finance Inc., Horsham, Pennsylvania.

The $140 million, combined with a majority investment from sponsor Prudential Real Estate Investors (PREI), Parsippany, New Jersey, enabled The Shelter Group, Baltimore, to refinance seven Brightview senior housing properties and recapitalize, according to Mitchell Kiffe, Freddie Mac's vice president of production and sales.

"The fact that the properties are located in strong markets, coupled with PREI's investment expertise and The Shelter Group's seniors housing experience, made this a great transaction," said Kiffe. "The seniors housing market is growing by leaps and bounds. We are proud to be a stable, reliable source of funding for it."

The mortgages are secured by five independent-living facilities and two assisted-living facilities comprising 880 units located in Rhode Island, Massachusetts, Maryland and Virginia, explained Philip Brooks, Capmark Finance senior vice president.

"The Freddie Mac program is a powerful source of financing to the seniors housing industry. Structuring financing for portfolios can be complicated and has many moving parts," said Brooks. "Freddie Mac understands our customers' objectives, and has the flexibility to work with us to structure attractive deal terms to meet their needs."

The properties were built between 1980 and 2006 and have common dining rooms and commercial kitchens, among other amenities. Most units also have full kitchens or kitchenettes.

The transaction featured a 10-year fixed-rate mortgage (FRM) plus one-year floating rate, with seven years of partial interest only benefiting from the Freddie Mac Fixed-to-Float option and the Freddie Mac Standard Delivery Option, according to David Carliner, executive vice president for The Shelter Group.

"Freddie Mac stood by us despite the fact that the financial markets saw more turbulence from the inception of the transaction until its closing than the industry had experienced in a very long time," said Carliner. "The terms offered by Freddie Mac were super-competitive. Capmark was a strong advocate for the deal, and made sure that all of the pieces came together."

Since the introduction of the Freddie Mac Program Plus[R] network of multifamily loan originators and servicers in 1993, Freddie Mac has provided financing for approximately 55,000 multifamily properties totaling more than $194 billion, said Kiffe.
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Title Annotation:Commercial
Comment:Freddie Mac purchases $140 million mortgage pool for senior housing.(Commercial)
Publication:Mortgage Banking
Article Type:Brief article
Date:Aug 1, 2008
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