ST. PAUL, MN-Oak Grove Capital, based here, has the target of $2 billion to lend this year. The company recently finished two deals for three properties totaling almost $51 million.
The company originated a $33 million Fannie Mae adjustable loan for the refinancing of Fox Valley Villages, a 420-unit market-rate housing community in Aurora, IL. The property is managed by RMK Management Corp.
Oak Grove also originated a $17.9 million loan for three assisted living communities operated by Seattle-based Emeritus Senior Living. The properties include the 144-unit Emeritus at Amber Oaks in San Antonio, TX; the 54-unit Emeritus at Arborwood in Granger, IN and the 60-unit Emeritus at Seabrook in Everett, WA. The portfolio transaction was structured with a master lease agreement through which the operations of each community were sub-leased to Emeritus-sponsored operating entities.
The deals include regions that Oak Grove wants to expand to, says president Kevin Filter. “Our primary goal this year is to build our conventional loan business, and we are bringing in underwriters in markets we haven’t traditionally been in,” he tells GlobeSt.com. “We look to add three or four originators in markets such as Texas, Denver, Chicago and Milwaukee.”
His firm had $1.7 billion in business in conventional, affordable and senior housing lending in 2011. “Our target this year is $2 billion,” Filter says. “I think our pipeline is in pretty good position to meet that goal at this point. Of course, that depends on changes at Fannie or Freddie. Right now it’s steady as she goes, but there’s some pressure in Washington and on Wall Street.”
Affordable housing, as well as assisted and memory care housing, are both industries that are doing exceptionally well, Filter says. “In affordable, there’s very little new development, and more people qualify given the economy these days,” he says. “Independent living, however, has slowed down, as it’s dependent on retirees selling their homes in a down market.”
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