FANNIE MAE DUS®
Seniors Housing
Arbor’s Seniors Housing provides financing options for properties that provide Independent Living (IL), Assisted Living (AL), Alzheimer’s/Dementia Care (ALZ), or any combination.
Loan Amount | Minimum $5M, with exceptions on a case-by-case basis |
Loan Term | 5 to 30 years |
Amortization | Up to 30 years |
Minimum DSCR |
For combinations of IL, AL, and ALZ, special rules apply to calculate minimum DSCR. |
Maximum LTV | 75% (80% for fixed-rate, tax-exempt bonds) |
Rate Structure | Fixed- and adjustable-rate options available |
Eligible Properties |
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Eligible Borrower | Single Asset Entity. Owners and operators must have a minimum of five years experience in Seniors Housing, owning and/or managing a minimum of five stabilized properties |
Property Requirement | All properties must have a fully operational separate category sprinkler system in all units and in common areas and may not charge entrance fees. Typical community fees are allowed |
Occupancy Requirement | At least 90% occupied for each of the past five fiscal years |
Tax & Insurance Escrows | Fully funded replacement reserve, tax and insurance escrows are required |
Replacement Reserves | Underwritten at a minimum $300 per unit per annum. |
Recourse | Non-recourse execution is available, with standard carve-outs required for “bad acts” such as fraud, bankruptcy and illegal transfers |
Commercial Space | Maximum 10% of net rentable area and 10% of effective gross income. |
Required Reports | Appraisal, Property Condition Assessment, Phase I Environmental, Zoning, Termite, Flood and Seismic Report (for properties in Seismic Zones 3 and 4). Management and operations reports are required for all Seniors Housing Properties. Licensed seniors housing properties also require a Seniors Housing Liability Assessment Report. |
Prepayment | Yield maintenance, defeasance, and graduated prepayment premium |
Assumable | Loans may be assumable, subject to review and approval by the Lender and Fannie Mae of the proposed new borrower’s financial capacity and experience. 1% assumption fee |
Subordinate Financing | Not allowed |
Supplemental Financing | Supplemental Loans are available |
Pricing | Risk based pricing; more favorable pricing available for higher DSC and lower LTV |
Rate Lock | 30- to 180-day commitments; the early rate lock option is available with prior approval from Fannie Mae, allowing the borrower to lock a rate after the lender completes preliminary underwriting; extended rate lock feature is also available, allowing the borrower to lock a rate 45 to 365 days in advance of closing |
Application Deposit | $20,500; covers estimated processing and legal fees |
Origination Fee | 1% of loan amount |
Good Faith Deposit | 2% of loan amount, due at rate lock, refundable post-closing |
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