NYC Buyer Lands $171M for Senior Housing Buy

LOS ANGELES-Fortress Investment Group LLC has secured $171 million in acquisition financing through GMAC Commercial Mortgage Corp. for the $282.4-million purchase of a portfolio of nine senior housing facilities, most of them in Southern California. The funding consists of permanent, fixed-rate financing, according to William Kauffman and Len Deering of the Chicago loan origination office of GMAC Commercial Mortgage, who arranged the funding.Fortress Investment landed the funding for nine single-purpose entities that the New York City-based investment firm sponsors. The nine independent living facilities total 1,261 units, and all but two of them provide assisted living.Fortress Investment bought the properties from a senior housing investment fund managed by a major life insurance company. One property was built in 2000 and one in 1961, with the remaining seven constructed between 1986 and 1991.The properties are in Torrance, Irvine, Anaheim Hills, Rancho Mirage, Santa Monica, Monrovia, Ventura, Scotts Valley and Santa Rosa. Kauffman notes that GMAC Commercial Mortgage arranged the transaction through Fannie Mae to provide fixed-rate debt structured for a seven-year term at an interest rate of 5.38%.Although GMAC Commercial felt confident that the permanent financing would be forthcoming, Kauffman says, GMAC had variable-rate, interim financing available as an alternative if closing of the permanent loan was delayed.The acquisition of the nine facilities adds to the senior housing holdings of Fortress, which is the controlling shareholder of both Brookdale Living Communities, one of the nation's largest independent living managers, and Alterra Healthcare Corp., a leading assisted living operator. Brookdale Living Communities is managing the recently acquired portfolio.