Capital Senior Living Buys Three Communities For $83.6 Mln - Quick Facts

(RTTNews) - Capital Senior Living Corp. (CSU) announced Tuesday that it has purchased three senior living communities located in Ohio from joint ventures in which it held a 10 percent interest for a purchase price of $83.6 million. Previously, the company managed the Ohio JV Communities under long-term management agreements.

The Ohio JV Communities are comprised of 433 units, consisting of 227 independent living units and 206 assisted living units. Two communities are financed with $40.1 million of 10-year fixed rate debt that is non-recourse to the Company with a blended interest rate of 4.41%. One community is financed with a $21.6 million two-year bridge loan with a variable interest rate of approximately 2.90%.

Additionally, the company announced it has closed a refinance of debt on 15 owned communities, raising approximately $156.5 million of new mortgage debt consisting of $135.5 million in long-term fixed rate debt and approximately $21 million in bridge loans. The $135.5 million long-term debt has a 4.24% fixed interest rate, which represents a 172 basis point reduction in rate, and matures in July 2024. These new mortgages replaced $92 million of fixed rate debt with a blended interest rate of 5.96% that were set to mature in July 2015. The $21 million in bridge loans replaced approximately $20 million of fixed-rate debt that was also maturing in July 2015.

The bridge loans are related to one property being repositioned to allow more flexibility during the repositioning and certain non-core owned assets planned for sale in the third quarter of 2014.

The bridge loans have a one or two-year maturity with a variable interest rate of approximately 4.65%. With this refinancing, the Company's overall debt on this portfolio increases about $44.6 million; however, the Company's interest expense remains approximately the same due to the lower rate and the Company's total debt service payment decreases about $1.0 million due to re-setting the principal amortization to 30 years from 25 years.