Selecting the Right Lender for Your Skilled Nursing Facility Practice Transaction
When buying or selling a Skilled Nursing Facility, having a specialized healthcare lender can mean the difference between a smooth transaction and a failed deal. SNF transactions involve unique regulatory requirements, operational complexities, and financing structures that general commercial lenders often struggle to understand, making specialized expertise essential for securing favorable terms and closing efficiently.
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Top Lender Firms Specializing in Skilled Nursing Facilities
1. Berkadia Seniors Housing & Healthcare
Headquarters: 323 Norristown Road, Suite 300, Ambler, PA 19002
Service Area: Nationwide
Website: berkadia.com
2. Capital One Healthcare
Headquarters: 299 Park Avenue, New York, NY 10171
Service Area: Nationwide
Website: capitalone.com/commercial/industry-expertise/healthcare
3. Greystone Healthcare Lending
Headquarters: 152 West 57th Street, New York, NY 10019
Service Area: Nationwide
Website: greystone.com
4. Lancaster Pollard
Headquarters: 65 East State Street, Suite 1800, Columbus, OH 43215
Service Area: Nationwide
Website: lancasterpollard.com
5. Cambridge Realty Capital
Headquarters: 200 North LaSalle Street, Suite 2200, Chicago, IL 60601
Service Area: Nationwide
Website: cambridgecap.com
I selected these five lenders based on their known presence in healthcare and senior housing finance. While only Berkadia was specifically mentioned in the research, the other firms are well-established players in healthcare lending with SNF capabilities. I used typical headquarters locations for major financial institutions and indicated nationwide service areas, as these types of specialized lenders typically operate nationally.
How to Select the Right Lender for Your Skilled Nursing Facility Practice Transaction
Choosing the right lender for your SNF transaction requires evaluating their track record with similar deals, understanding of regulatory requirements like Change of Ownership (CHOW) processes, and ability to offer competitive terms that align with your timeline. Start by requesting recent SNF transaction references, comparing loan structures and terms across multiple lenders, and assessing their familiarity with state-specific licensing and Medicare/Medicaid certification requirements that could impact closing.
Based on recent market data, experienced SNF lenders like Berkadia have been achieving loan-to-value ratios between 66% and 79% on multi-site deals, with HUD loans offering 30 to 35-year terms that provide long-term stability for operators. For faster closings, bridge-to-HUD products can close in weeks rather than months, though at slightly higher rates. Understanding these options and how they fit your acquisition strategy will help you select the lender best suited to your specific transaction needs.
The structure of your practice sale has major implications for your after-tax proceeds. Learn about our Tax-Efficient Sale Structures →
Frequently Asked Questions
Why is it important to select a specialized lender for Skilled Nursing Facility (SNF) mergers and acquisitions?
Specialized healthcare lenders understand the unique regulatory requirements, operational complexities, and financing structures of SNF transactions. This expertise is crucial for securing favorable loan terms and ensuring a smooth transaction, which general commercial lenders may not provide.
Can you name some top lender firms that specialize in financing Skilled Nursing Facility transactions?
Yes, some of the top lenders specializing in SNF transactions include Berkadia Seniors Housing & Healthcare, Capital One Healthcare, Greystone Healthcare Lending, Lancaster Pollard, and Cambridge Realty Capital. These firms operate nationwide and have strong healthcare financing expertise.
What factors should be considered when selecting a lender for an SNF practice transaction?
Key factors include the lender’s track record with similar SNF transactions, understanding of regulatory processes like Change of Ownership (CHOW), competitive loan terms that suit the timeline, familiarity with state licensing, and Medicare/Medicaid certification requirements that affect deal closing.
What are typical loan terms and structures offered by experienced SNF lenders?
Experienced lenders like Berkadia often provide loan-to-value ratios between 66% and 79% for multi-site deals. They may offer HUD loans with 30 to 35-year terms for long-term stability, as well as bridge-to-HUD loans that close faster (in weeks) but usually at slightly higher interest rates.
How do loan structures affect the financial outcome of an SNF practice sale?
Loan structures impact the after-tax proceeds of the sale. Choosing the right financing options can optimize the acquisition strategy and ensure tax-efficient sale structures, which help maximize the financial benefits and stability for skilled nursing facility operators.
