From Challenges to Opportunities: Navigating the Senior Living Housing Market with CPACE Financing

Peachtree Group originated a Commercial Property Assessed Clean Energy (CPACE) loan for $8.3MM for the new construction of a 64-unitmemory care facility in Orlando, Florida. The loan amount represents 28% of the appraised value and 31% of the total development cost.

Senior living spaces are a growing market with sustained supply-demand trends restoring occupancy rates to their pre-pandemic levels, ultimately leading to positive revenue growth. Despite these positive trends in the overall market, securing financing for a facility that includes memory care or assisted living is often more difficult due to the required licensing. Because of an existing relationship with a senior lender, Peachtree Group was able to carve out the CPACE portion of the loan, which provides lower-cost financing for the sponsor. The CPACE loan funds went toward the building envelope, mechanical systems (HVAC), electrical and plumbing.

The Orlando area senior population is forecasted to grow beyond the national average, necessitating the need for more senior living, and this development has a strong basis of $129K/unit. The property is conveniently located near major highways, making it easily accessible for visiting family. It is also part of an affluent and growing area of Orlando called Dr. Phillips, known for its award-winning schools and waterfront homes. As the parents of these families age, the project offers an option for care close to their home.

Certus is a growing owner-operator of assisted living memory care communities, with eight communities in its portfolio. The company’s senior leadership team has over 40 years of experience in successful real estate ownership, property development, and commercial real estate, specializing in senior living housing. In addition, the principals have experience in retirement community management and working with memory care patients. Four of the eight communities in their portfolio have opened within the past three years, and the remaining are under development.

Certus efficiently uses the same development plans, budgets and business strategy for all developments in its portfolio.

The property for this development is located within a 10-mile radius of three major hospitals (Orlando Health Center, Orlando Health Regional Medical Center and Orlando Health Horizon West). In addition to an affluent housing market, the Dr. Phillips suburb of Orlando has fine dining and shopping along the renowned "Restaurant Row.” It is also less than a 10-mile drive from Universal Studios and Disney World, offering attractions for visiting family.

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Peachtree Group is a senior bridge and construction lender that can provide CPACE financing on projects currently under construction or completed within the last 36 months. The program is available for all commercial real estate asset classes.

Learn more about CPACE financing or contact Peachtree's CPACE team.

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