PHILADELPHIA, PA — In case you missed it, GREA’s Philadelphia office has arranged a $44.2 million senior construction loan to finance a 162-unit senior living development in West Chester, Pennsylvania, marking the first new senior housing asset to be delivered in the market in 10 years.
The project, planned for 943 South High Street, comes as senior living developers cautiously re-enter capital markets that tightened sharply in the wake of the COVID-19 pandemic. Industry observers say the financing signals renewed lender confidence in select senior housing opportunities with strong local fundamentals.
According to GREA, the loan carries a 65% loan-to-cost ratio and a 50% loan-to-value ratio, with an interest rate set at SOFR plus 350 basis points. The structure includes full-term interest-only payments and a four-year term, consisting of an initial three-year period with a one-year extension option.
George Johnson of GREA said senior living projects have faced unusually steep headwinds in both debt and equity markets over the past several years, making new construction financing difficult to secure.
Johnson said the West Chester project stood out due to its location, the strength of the developer-operator, and favorable demographic trends in the surrounding market, factors that ultimately persuaded the lender to commit capital on competitive terms.
The development is expected to address pent-up demand in a submarket that has seen no new senior living deliveries in a decade, despite an aging population and limited existing inventory.
GREA said the transaction reflects a broader but selective reopening of capital markets for senior housing, particularly for projects viewed as well-positioned to deliver quality assets in supply-constrained markets.
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