Aegis Affiliate Secures $16M in Mortgage Financing

ESCONDIDO, CA-An affiliate of Aegis Assisted Living has secured $16.1 million in mortgage financing that will serve as a permanent take out on an existing construction loan for its seniors housing property, known as Aegis of Escondido, which is located here. Funded by Collateral Mortgage Capital LLC through Fannie Mae, the financing has been issued in two forms. “A large portion of the loan (approximately $14.3 million) was financed via credit enhancement of existing tax-exempt bonds,” Collateral’s director Scott Kavel tells GlobeSt.com. The second issuance was comprised of a conventional, floating rate, discount mortgage backed security of nearly $1.8 million, according to a company statement released by Collateral. “This loan is part of a larger, $110-million credit facility with Fannie Mae,” Kavel notes. “A portion of the credit facility closed in late 2003 and since then, we’ve been adding properties,” he tells GlobeSt.com. Collateral’s team worked with Fannie Mae’s Multifamily Structured Transaction group, as well as Fannie Mae’s Seniors Housing group, to negotiate and fund the facility.The recent $16.1-million financing was not without its obstacles, as Kavel points out. Completed in February 2003, the property has a limited operating history, which posed a challenge. “In addition, the transaction included tax abatement, due to the partnering up with an eligible, not-for-profit, 501c3 corporation,” Kavel says. Despite the complexity of the deal, however, the transaction did go “very smoothly,” Kavel notes. Located on a 5.8-acre parcel at 3012 South Bear Valley Parkway in Escondido, the Aegis affiliated community was 90% occupied as of October 2003. The property is comprised of “one two-story, main building with 107 units (83 independent living and 23 assisted living) and five freestanding, duplex-style “Casita” buildings (all independent living) for a total of 117 units,” according to a Collateral company statement. Amenities here include four laundry rooms, four dining rooms, a bistro, coffee shop, general store, lounge area, theater, beauty salon, day spa, fitness center, swimming pool, Jacuzzi, massage parlor, a library/computer center, and limited covered parking. The property is currently managed by Aegis Assisted Living.”This was the first primarily independent living property for the owner/operator,” Kavel notes, adding that Collateral “has financed a number of properties for them and others in California” and is looking to do more business here. According to Kavel, the Southern California market is “extremely strong,” with the Aegis property and others having exceeded expectations.