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Freddie Mac Buys $140M Mortgage Pool

Shelter Group, with financial partner Prudential, uses the funds to recapitalize its communities.

By Sule Aygoren Carranza | Updated on June 27, 2008

MCLEAN, VA-Mortgage giant Freddie Mac recently bought a pool of seven mortgages from Capmark Finance Inc. worth $140 million. The loans are cross-collateralized and cross-defaulted by seven seniors housing properties–owned by the Shelter Group of Baltimore.

Combined with an undisclosed majority investment from Prudential Real Estate Investors, the debt allowed Shelter Group to recapitalize the communities, relates Mitchell Kiffe, Freddie Mac’s vice president of production and sales. The portfolio consists of 880 units–in five independent living and two assisted living properties–that operate under the Brightview brand in Rhode Island, Massachusetts, Maryland and Virginia.

“We liked everything about this transaction,” says Kiffe. “We’ve done business with Prudential before. They’re a great institutional owner of real estate and they’ve got significant expertise and experience in the senior housing space. Shelter was new to us but we think they’re a very strong owner, operator and developer of seniors housing communities. So we like the sponsor and the real estate–most of it is relatively new–are quality properties in good markets. The economics were favorable.” Built between 1980 and 2006 the communities all count common dining rooms and commercial kitchens among their amenities, and most of the units have full kitchens or kitchenettes.

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