Last month, construction crews began pushing dirt at the future home of Orchard Park of Murphy, a $12.7 million assisted living and memory care center going up in Murphy. This week, the owners of that development are breaking ground on a similar facility in Odessa. That these projects are going forward at all is a testament to the federal loan insurance programs behind them.
In both cases, local development firm McFarlin Group won the backing of the U.S. Department of Housing and Urban Development, which offers a range of loan insurance programs to help support construction and long-term financing for healthcare facilities and multifamily properties. Thanks to the federal government's assistance, HUD lenders like Love Funding are able to offer low interest rates, non-recourse debt, and extended terms generating substantial debt service savings for borrowers.
Given the difficulty in obtaining credit from private sources, healthcare property developers are turning to HUD's loan insurance programs in droves. During the fiscal year that just ended last month, HUD approved 1,659 multifamily and healthcare loans, up from 1,320 in fiscal 2010 and just 713 the year before.
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