Cambridge Realty Capital Cos. has provided a $3.9 million HUD first mortgage loan to refinance the Cahokia Nursing and Rehabilitation Center, a 150-bed skilled care nursing facility in Cahokia, Ill., located in the St. Louis metro area.
The fully amortized 35-year term loan was arranged for the property’s owner, an Illinois limited liability company, using HUD’s Section 232 funding program and pursuant to Section 223(a)(7). The program is designed for owners refinancing an existing HUD loan.
The loan was underwritten by Cambridge Realty Capital Ltd. of Illinois, the company’s HUD underwriting business. The interest rate was not disclosed.
Headquartered in Chicago, Cambridge Realty Capital Cos. has a national origination office in Los Angeles and numerous correspondent and brokerage relationships nationwide. The company is one of the nation’s leading senior housing/healthcare lenders, with more than $3 billion originated since the mid-1990s.
While lending activity is increasing in the seniors housing industry, deals are being completed at low loan-to-value ratios with more conservative underwriting, says Jeffrey Davis, chairman of Cambridge Realty Capital Cos. “In general, the more typical acquisition loans continue to be challenged, and for some borrowers relationships with capital sources have been strained.”
Cambridge Realty Capital Cos. processed 267 loan origination requests in 2010 totaling $3.72 billion, or slightly fewer than 2009 when the company reviewed 298 loan requests totaling $4 billion, according to Davis. “Loan origination request volume remained strong in 2010, but Cambridge was forced by reality to be more selective,” notes the chairman.
Although the financing climate for acquisitions has steadily improved in recent months, the same can’t be said of financing for new development, says Davis. “General conditions in the capital markets have made it more difficult to obtain funding for new construction, except on a selective basis. Our strategy has been to be upfront with borrowers who request our help.”