FANNIE MAE® Seniors Housing

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Arbor’s Seniors Housing Financing provides financing options for properties that provide Independent Living (IL),
Assisted Living (AL), Alzheimer’s/Dementia Care (ALZ), or any combination.

Loan Amount

Minimum of $5,000,000, with exceptions on a case-by-case basis

Loan Term 5 to 30 Years

Up to 30 Years

Minimum DSCR

1.30x if the property is 100% Independent Living
1.40x for properties with an assisted living and/or Alzheimer’s component greater than 50%
1.45x if the property is stand-alone Alzheimer’s/Dementia Care

Coverage for properties with less than 50% AL or ALZ will be on a weighted average basis.

Maximum LTV 75% (80% for fixed rate tax-exempt bonds)
Rate Structure

Fixed and adjustable rate options available

Eligible Properties
  • Independent Living properties
  • Assisted Living properties
  • Alzheimer’s / Dementia Care
  • Newly constructed and stabilized Seniors Housing facilities, as well as campuses containing skilled nursing beds on a case- by-case basis
Eligible Borrower

Single-asset entity. Owners and operators must have a minimum of five years experience in seniors housing, owning and/or managing a minimum of five stabilized properties.

Property Requirement

All properties must have a fully operational separate category sprinkler system in all units and in common areas and may not charge entrance fees. Typical community fees are allowed.

Occupancy Requirement 90% average physical occupancy for 12 months for IL. AL/ALZ properties must be 90% occupied on average for 15 months prior to funding.
Tax and Insurance Escrows Fully funded replacement reserve, tax and insurance escrows are required.
Replacement Reserves Underwritten at a minimum $300 per unit per annum.
Recourse Non-recourse execution is available, with standard carve-outs required for “bad acts”, such as fraud, bankruptcy and illegal transfers.
Commercial Space Maximum 10% of net rentable area and 10% of effective gross income
Required Reports Appraisal, Property Condition Assessment, Phase I Environmental, Zoning, Insect, Flood and Seismic Report (for properties in Seismic Zones 3 and 4). Licensed Seniors Housing Properties also require a Seniors Housing Liability Assessment Report.
Prepayment Yield Maintenance, Defeasance, and Graduated Prepayment Premium
Assumable Loans may be assumable, subject to review and approval by the Lender and Fannie Mae of the proposed new borrower’s financial capacity and experience. 1.00% assumption fee.
Subordinate Financing Not allowed
Supplemental Financing Supplemental Loans are available.
Pricing Risk Based Pricing. More favorable pricing available for higher DSC and lower LTV.
Rate Lock 30- to 90-day commitments. The Early Rate Lock option is available with prior approval from Fannie Mae, allowing the borrower to lock a rate after the Lender completes preliminary underwriting. Extended rate lock feature is also available, allowing the borrower to lock a rate 45 to 365 days in advance of closing.
Application Deposit Approximately $15,000. Covers estimated underwriting costs (including processing fee).
Processing Fee $3,000 non-refundable
Origination Fee 1% of loan amount.
Legal Closing Fee Arbor’s Counsel Fee to be determined at application
Good Faith Deposit 2% of loan amount, due at rate lock, refundable post-closing
Arbor Commercial Mortgage | | 800.ARBOR.10