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NEW
CONSTRUCTION & SUBSTANTIAL RENOVATION
LOANS
FOR
NURSING HOMES & ASSISTED LIVING FACILITIES
FHA SECTION 232
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| Eligible
Projects: |
Eligible
Projects include: 1) proposed new construction, 2) acquisition with
substantial renovation, and 3) the
refinance with substantial renovation of existing Nursing Homes and
Health Care Facilities nationwide. AMERICAN MORTGAGE prefers to work
on developments
of 100 beds or larger. Existing projects involving renovation work
must at a minimum include one or more of the following to qualify:
- Replacement of at least two major building components (i.e.)
roof, HVAC system, new windows, etc., or
- The renovation must
meet or exceed 15% of HUD's estimated value of the project after
the work is in place.
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| Geographic
Preference: |
| Nationwide
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| Mortgage
Amount: |
| up
to $100,000,000
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| Loan
Features: |
- Low fixed interest rates
- Construction term as needed, plus up to
40 year permanent loan term
- Up to 90% loan-to-value ratio (up to
95% LTV for not-for-profit Borrowers)
- Minimum Debt Service Coverage
1.11% (90% of NOI)
- Fully amortizing
- Non-recourse
- Fully assumable
- Pre-payable with restrictions
- No rent control restrictions
- No limitations on owner's return
-
Mortgage proceeds
may be used to pay for acquisition or refinancing costs,
including the hard cost of repairs, replacements, improvements
and major movable equipment.
-
New additions
may also be built, however, new additions may not be considered
in the calculation of determining if the project meets HUD's
minimum renovation requirement for the existing
facilities.
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| Prevailing Wage Requirement: |
The payment of prevailing wages is required pursuant to
the Davis-Bacon Wage Act based on Commercial Rates.
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| Secondary
Financing: |
| Secondary
financing is not permitted by HUD. However, mezzanine financing is
permitted.
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| Prepayment/Lockout: |
Negotiable.
Typically locked out during construction, then ranging from a five-year
lockout to a ten-year lockout during the permanent loan, with or
without
a declining prepayment penalty in the five years
beyond the lockout period of 5%, 4%, 3%, 2%, 1%, 0%. The note interest
rate will be adjusted according to the selected lockout/prepayment
terms.
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