Ventas Closes $126M in Refis on 8 Assisted Living Communities

Ventas Inc. has closed eight first-mortgage loans totaling $126 million through Freddie Mac on eight senior housing communities in three states managed by Sunrise Senior Living Inc. Proceeds of the loan were used to repay in full $71 million of existing debt, secured by the same facilities that was due to mature in mid-2009.The debt, which matures in January 2019, with a possible one-year extension, is 6.5 per cent inclusive of costs, expenses and fees. The borrowers under the $126 million Freddie Mac loan are owned 85 percent by Ventas and 15 percent by Sunrise. KeyCorp Real Estate Capital Markets Inc. is the initial lender for the loan and will service the loan following its sale to Freddie Mac. “This refinancing further improves Ventas’s excellent balance sheet and liquidity position,” Debra Cafaro, Ventas president & CEO, said in a statement Friday. “This new $126 million 10-year loan also demonstrated that stabilized private pay seniors housing assets with strong owners can attract well-priced long-term capital.” The company said the eight assisted living facilities secured by the loan have average occupancy of 91 percent. Ventas has been making a concerted effort to refinance senior notes and loans maturing within the next two years as well as paying down its debt. The REIT noted Friday that it had also repurchased at a net discount an additional $37 million of its senior notes due 2009 or 2010 and repaid an additional $24 million of secured debt. So far this year, Ventas has repaid $143 million of secured debt and purchased at a net discount $176 million aggregate principal amount of senior notes due in 2009 and 2010. “We believe that, to be successful in today’s environment, companies must have low leverage, limited near term maturities and continued access to capital. As a result of our efforts during the last few years, Ventas has all three,” Cafaro stated in a Nov. 4 news release about its third-quarter finances. Ventas, headquartered in Chicago, paid about $2 billion in April 2007 for Toronto-based Sunrise Senior Living Real Estate Investment Trust. The deal added 77 senior housing communities to Ventas’ portfolio, including 11 in Canada. Ventas owns 253 senior housing facilities, 41 hospitals, 192 skilled nursing facilities and 30 medical office buildings and other healthcare facilities located in 43 states and two Canadian provinces.