New Beginning for Erickson Following Bankruptcy Auction
	Troika of Fannie, Freddie and HUD Keep Lending Market Alive
	Continuing Care Retirement Community to Open in Greater Los Angeles

After an 18-hour bankruptcy auction in December, Redwood Capital Investments emerged as the winner with a bid of $365 million for Erickson Retirement Communities, a financially troubled company that also happens to be one of the top brands in the seniors housing business. The rigorous process shows that no deal is done until the final bid is tallied, and that there’s real interest in seniors housing by deep-pocketed investors.

“This (deal) is a good sign for the sector,” says Robert Kramer, president at the National Investment Center for the Seniors Housing & Care Industry (NIC). “Clearly, word is getting out to investors about seniors housing.”

Redwood outbid a group led by private-equity giant Kohlberg Kravis Roberts & Co., along with private-equity firm Beecken Petty O’Keefe & Co., and Coastwood Senior Housing Partners. Other potential bidders expressed interest in the deal, according to Erickson’s bankruptcy attorney Thomas Califano at DLA Piper’s New York offices where the auction was held. But only Redwood and KKR participated in the final auction.

Government-backed loan programs will continue to be a rich source of capital this year for seniors housing, making it the bright spot in the commercial real estate sector.

Fannie Mae and Freddie Mac, the government-sponsored enterprises (GSEs) that provide liquidity to lenders, are expected to each plow about another $1 billion into the seniors housing market in 2010.

Despite a recent slowdown of approvals because of a surge in applications, HUD’s 232 lending program also will continue to supply loans for seniors housing while program administrators work to expedite deal approvals.

“Fannie and Freddie are critical to seniors housing today,” says Philip Brooks, senior vice president at the Richmond, Va., offices of Berkadia Commercial Mortgage, a new company formed last December by industry veterans. “Both (GSEs) are open and eager for business.”

Fountainview at Eisenberg Village, a new continuing care retirement community in Reseda, Calif., will open its doors for charter members beginning Monday, Feb. 15. The development, a member of the family of services offered by the Los Angeles Jewish Home, consists of 108 one- and two-bedroom apartments.

Fountainview is designed to provide active, healthy living options for independent seniors. “When we broke ground on Fountainview in December 2007, we did so with the purpose of meeting the changing housing needs for independent seniors in Los Angeles,” says Molly Forrest, president and CEO of the Jewish Home.