CHEVY CHASE, MD-Alpharetta, GA's Formation Capital Health Care LLC has won a 27-property portfolio of long-term care facilities and an institutional pharmacy. The seller was Westerville, OH-based Laurel Health Care Management.
Locally based CapitalSource supplied a $172-million financing package. In addition to the loans, Formation Capital came up with $30 million to complete the approximately $202 million purchase.
"This was an extremely complicated transaction with a lot of moving pieces," says Formation president and co-chairman Steve Fishman. The purchase involves 21 skilled nursing facilities, four assisted living facilities, one independent living property and a pharmacy; the long-term care properties account for 2,800 beds in Indiana, Michigan, North Carolina and Virginia.
The Formation Capital entities received the financing in the form of a three-part package consisting of a $144-million senior real estate loan, a $16-million subordinated real estate loan and a $12-million loan secured by the pharmacy business. Separately, in a another facet of the transaction, CapitalSource came through with a $12.5-million revolving credit facility for LHCC Properties, a division of Laurel Heath Care.
James Pieczynski, CapitalSource co-president of Healthcare and Specialty Finance, tells GlobeSt.com that the credit facility is for the purpose of leasing the 27 properties and for financing working capital needs. The facility is secured by accounts receivable.
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