Senior Living Notes (January 2007)

Nordberg to head new joint venture



By Murray W. Wolf


Former Medical Office Properties Inc. chief executive Edward P. Nordberg Jr. will head a new joint venture aimed at acquiring, financing and investing in senior housing and healthcare-related properties.

NorthStar Realty Finance Corp. (NYSE: NRF) recently announced that it has entered into a definitive agreement with Chain Bridge Capital LLC to form a joint venture called Wakefield Capital LLC. As part of the deal, Wakefield will acquire substantially all of Chain Bridge’s assets.

Chain Bridge Capital LLC is a private real estate and finance company that is focused primarily on the acquisition, development and financing of healthcare-related real estate assets, with an emphasis on senior housing properties. Those include independent and assisted living, skilled nursing and continuing care retirement communities (CCRCs).

The initial portfolio to be acquired from Chain Bridge is valued at about $64 million and will consist of 13 net leased properties, primarily assisted living facilities, and several loans receivable, most of which are secured by first mortgages on senior housing assets.

Chain Bridge, based in Chevy Chase, Md., was founded by Mr. Nordberg, who is also the company’s chairman and CEO. He is also the former CEO of Medical Office Properties, which sold its 22-building medical office building (MOB) portfolio to CNL Retirement Properties Inc. for $256 million in 2004. (Please see “One deal, two strategies” in the June 2004 edition of Healthcare Real Estate Insights.)

Mr. Nordberg was also a co-founder and the former CFO of HealthCare Financial Partners Inc., which was a publicly-traded company under the ticker “HCF” until it was sold in 1999 to Heller Financial. Mr. Nordberg will continue to oversee the asset management of the properties acquired by Wakefield Capital LLC.

NorthStar is an internally managed REIT that originates and invests in commercial real estate debt, real estate securities and net lease properties.

In a news release, NorthStar stated: “The new venture will take advantage of the attractive yields and favorable demographics in the senior housing sector of the net lease market.”

Wakefield expects to invest significant capital, funded by NorthStar, in building a nationwide portfolio of assisted living, skilled nursing and other senior living and healthcare-related assets which will be managed and net leased to experienced, independent operators of such facilities. Wakefield will be majority owned and controlled by NorthStar and will be managed by a company owned by the principals of Chain Bridge, which has entered into an exclusivity arrangement with Wakefield.

“We hope to put significant equity to work in this sector of the commercial net lease market which is underserved and significantly less competitive as a result of the specialized expertise and experience necessary to successfully invest in this asset class,” David Hamamoto, NorthStar president and CEO, stated in the news release. q

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