Thorofare Capital Funds $13 Million Short-Term Bridge Loan for recently Converted Senior Housing Asset in Phoenix

The structured loan repays the borrower’s construction loan and funds reserves while the facility continues its stabilization

Los Angeles, CA & Phoenix, AZ — Thorofare Capital, which is expanding its Senior Housing bridge-to-agency lending program, has funded a $13 million short-term bridge loan for the refinance and renovation of Park Terrace at Gateway (Park Terrace), a 277-unit assisted and independent living facility located in North Phoenix, Arizona.

The two-year, interest only floating-rate loan provides an initial advance of $10 million to repay the construction loan and fund reserves to facilitate the lease-up of vacant units, with $3 million withheld for future funding of the completion of unit renovations and an “earn-outs” based on performance milestones.

The Sponsor, a Southern California-based real estate investor with international and domestic assets, purchased acquired the asset, then an Embassy Suites Hotel, in 2015 out of a bank’s REO portfolio.  It was converted by the Sponsor to a senior living facility in 2016.

The ADA-compliant property consists of 184 independent living units and 93 assisted living units. It features a garden-style layout, with amenities including multiple recreation rooms, a tennis court, large pool, refurbished outdoor patio space and a walking trail.

“While the Phoenix market is absorbing a notable amount of new supply, this asset presented an attractive loan basis and it provides a value-oriented price point which does not compete with high end, resort-style senior housing assets recently built by REITs and institutional developers in the area,” said Brendan Miller, Thorofare’s CIO. “We were able to offer the sponsor a flexible bridge loan that included future funding for CapEx completion, an appealing structure coupled with an ‘earn-out’ with a fast execution given our well-capitalized platform and balance sheet capabilities.”

Park Terrace is Thorofare’s second Phoenix-area senior housing loan.  It previously funded a $19 million bridge loan for MorningStar at Arcadia, a Class A 135-bed assisted living community in the Arcadia sub-market of Phoenix.