Emeritus Closes Refi Deal, Extends $73M Debt

Assisted living and Alzheimer’s care facilities provider Emeritus Corp. capped the end of the year by ensuring there would be no material maturities hanging over its head in 2009. The company wrapped up the $36.3 million refinancing of seven properties through Freddie Mac, a move that allowed it to pay down and extend an existing debt with Capmark. Freddie Mac provided Emeritus with a 10-year loan at a fixed rate of 6.05 percent, and the company quickly put the proceeds to use. Emeritus applied $20.1 million toward the Capmark loan, leaving a $72.7 million balance that the company was then able to extend from September 2009 to January 2012 at an initial interest rate of 6.5 percent. Now, Emeritus chairman & co-CEO Dan Baty noted in a prepared statement, “We have no material maturities for the next three years.” In the face of a ghastly real estate market–the seniors housing sector being less hard-hit than other sectors, but affected nonetheless–Emeritus has been faring relatively well. The company’s third quarter 2008 total community revenue from continuing operations was $191.8 million, a notable increase from $185.7 million in the previous quarter and an even more sizable jump from the third quarter 2007 figure of approximately $133.9 million. And there are more signs of success; Emeritus’ same-store average occupancy rose from 86.7 percent in the second quarter to 87.2 percent in the third. With the books in good shape, the company spent the last few months of 2008 completing a shopping spree. In October, Emeritus concluded its two-part $299 million acquisition of 29 properties from Health Care REIT, and in December, it snapped up five communities from Ventas Inc. in a $62.5 million deal. Headquartered in Seattle, Emeritus owns and operates freestanding assisted living communities across the United States. Presently, the company’s portfolio encompasses 302 communities in 36 states.