An Oklahoma senior living operator is relieved to have finally closed on two HUD loans for five separate properties his company owns. The loans for the Oklahoma facilities (one for skilled nursing/assisted living/independent living and the other for skilled nursing/assisted living), were challenging from the very beginning. The loan process itself took longer than would be considered “usual” in Cambridge’s history, due largely to the number of obstacles the operator needed to overcome in order to be approved. Nevertheless, Diakonos Group CEO Scott Pilgrim couldn’t be more pleased with the final results. Says Cambridge Realty Capital Managing Director Sampada D’silva, “Diakonos was extremely attentive to all of the details of this transaction and was quick to provide all documentation requested, which helped to move the process along efficiently.”
This was Pilgrim’s second time working with Cambridge, although it involved the same properties as the first time. Back then, Diakonos had just recently purchased the facilities, which were under-performing and in desperate need of rehabilitation. The Diakonos Group specializes in turn-around and re-development of under-performing facilities, and the Oklahoma properties were a good fit for Diakonos’ portfolio. That’s not to say that there weren’t challenges, though. “There were a lot of puzzle pieces to put together,” Pilgrim admitted.
Diakonos first approached Cambridge looking for bridge loans. Bridge loans would provide Diakonos with the opportunity and the funding required to get the facilities back on track so that the company could then pursue HUD funding.
Diakonos had a solid business plan and, upon receiving the bridge funding, embarked on an intensive rehabilitation effort. The company ran into a number of snags along the way, including an unexpected dip in performance in one of the properties partway through the process. “That problem could have killed the deal,” Pilgrim reported, “but Cambridge coached us through it and helped it get across the finish line.”
Pilgrim worked with several Cambridge staff members throughout the various stages of the HUD application process: Senior Vice President Brent Holman-Gomez, President Jeffrey Davis, Vice President Tony Marino and D’silva, with much of the “heavy lifting” done by D’silva, Pilgrim reported. However, both D’silva and Pilgrim commented that “it was really a team effort” that pulled the two deals together.
Pilgrim was happy with the outcome which, he noted, came about as quickly as it could have given the tricky details of the properties. He was pleased with his experience with Cambridge the first time around, and he was equally delighted with his most recent dealings with Cambridge. “Cambridge took a complicated process, which was made even more complicated by the circumstances of the facilities, and they got it done,” he declared. “The HUD process in itself is painful. Not only do you have to have all of the boxes checked, it has to be with the right color of ink,” he quipped about the precise and unyielding requirements of HUD. Fortunately, Cambridge did a thorough job of preparing Pilgrim for his part of the process, as well as solving the complex problems that emerged along the way. “Cambridge held our hand during the process and made it as painless as it could be.”