Senior Living

  • Senior living properties must adhere to comprehensive regulatory requirements at the federal, state, and local levels.

    Lenders need to ensure compliance with health and safety regulations, staffing mandates, and licensure, which can influence the financing process.

    They often assess the operational expertise of the borrower or management team, as running senior living facilities demands specialized knowledge in healthcare, resident care, and facility management.

    These properties have varied revenue streams, including private pay, Medicare, Medicaid, and long-term care insurance. Lenders evaluate the mix and stability of these income sources when considering financing.

    Operating costs for senior living properties are typically higher due to staffing, healthcare services, and facility maintenance. Additionally, these properties may experience longer lease-up periods compared to traditional multifamily properties.

    Specialized financing programs, such as government-backed loans from agencies like HUD, may be available and offer favorable terms for eligible properties.

    Lenders often require additional risk mitigation measures, such as higher reserves, performance guarantees, or third-party management agreements, to ensure effective operation of the facility.