Love Funding, one of the nation’s leading providers of FHA multifamily, affordable and healthcare financing, announced the closing of a $27.1 million refinancing loan for Santiam Memorial Hospital, a 40-bed acute-care hospital in Stayton, Oregon.
The financing was secured by Love Funding’s Matthew Andrea and Steven Hunt through the U.S. Department of Housing and Urban Development’s Section 242/223(a)(7) loan insurance program. Using the program, which is for the refinancing of hospital loans already in HUD’s portfolio, enabled the borrower to lock in a low, fixed interest rate for the remaining 22 1/2 years of the term of the existing loan.
The hospital’s roots stem back to 1950, when North Santiam area community leaders formed a nonprofit organization whose sole mission was to build a community hospital. The hospital opened its doors in 1953, then underwent multiple expansions and remodels over the years. In 2011, in order to meet increased demand and improve the patient care environment, the hospital secured a Section 242 loan to build a west tower, which effectively doubled the size of the facility. The refinancing of the loan associated with this construction project will help save the hospital nearly $145,000 a year in debt-service costs.
HUD is hoping to expand upon the $242 million in hospital financing transactions it insured in fiscal 2014 at a time when hospital management teams are struggling with reductions in reimbursements from Medicare and Medicaid, and other industry-wide financial pressures.
“Love Funding’s thorough knowledge of these unique programs and working relationships with the U.S. Department of Housing and Urban Development were essential for the successful completion of our refinancing,” said Santiam Hospital President and CEO Terry Fletchall. “The result is a significant reduction in financing costs and ‘righting the ship’ by correcting difficulties associated with our original financing company. Whether for financing a project or refinancing a current loan, Santiam Hospital recommends Love Funding. We are very pleased with the results of our choice.”
For more information, contact Steven Hunt.