VIUM CAPITAL & MERCHANTS CAPITAL COMPLETE $630 MILLION SECURITIZATION OF HEALTHCARE CRE LOANS

Seniors housing and healthcare lender VIUM Capital (“VIUM”) and its joint-venture partner Merchants Capital (“Merchants”), announced the securitization of approximately $630 million in healthcare commercial real estate (CRE) bridge loans. The loans were originated by VIUM and underwritten and closed on the balance sheet of Merchants’ parent, Merchants Bank of Indiana, within the past 16 months. The loans are intended to support the properties until they seek permanent financing through the U.S. Department of Housing and Urban Development’s (HUD) Section 232/223f refinance program. 

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The securitization pool contains 21 loans collateralized by 74 properties across 15 states for a variety of facilities, including skilled nursing, assisted living, memory care and independent living. The loans had a weighted average LTV of 69% and a weighted average debt yield above 15%. 

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Structured as a credit risk transfer (CRT), VIUM and Merchants, in collaboration with ATLAS SP Partners as structuring agent and sole bookrunner, partnered with a large investment manager specialized in alternative assets to purchase the junior securities, which totaled 15% of the transaction. As part of its purchase, the investor retained the first loss Risk Retention certificates as a third-party purchaser.

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“This transaction, which is our second securitization in as many years, provides our joint-venture partner with capital relief and credit risk reduction, thereby enabling us to expand our bridge loan capacity for our seniors housing and healthcare clients,” shared VIUM Co-Founder and Executive Managing Director Steve Kennedy. 

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VIUM Capital worked closely with Merchants’ capital markets team and ATLAS SP Partners to effectuate the deal. The transaction does not affect the interest rate or terms of the bridge loans. 

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“Our healthcare bridge loan portfolio continues to consist of high-quality assets producing solid debt service coverage as the loans season for permanent financing through HUD or the GSE’s,” commented VIUM Co-Founder and Executive Managing Director Kass Matt. “We will continue to lean into creative capital markets strategies to provide a leading platform for bridge and permanent funding solutions for our clients.”

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The transaction follows VIUM’s most productive HUD financing year since its launch in 2020. The firm has now closed over 200 financings totaling over $5 billion in healthcare CRE loans across more than 30 states. 

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VIUM is based out of Columbus, Ohio and has regional offices in Austin, Texas and Boca Raton, Florida. The firm is privately owned and controlled. Municipal advisory services for tax-exempt issuers provided through the firm's wholly owned subsidiary, VIUM Capital MA, LLC. The company can be reached at viumcapital.com.