Marathon Provides $235M Loan to Refinance Senior Housing Portfolio
Marathon Asset Management’s (“Marathon”) Commercial Real Estate platform has successfully originated a $235 million senior mortgage loan to an affiliate of Lone Star Real Estate Fund VI, L.P. (“Lone Star”). The loan is intended to refinance an eleven-property, mixed-acuity senior housing portfolio (the “Portfolio”) and support the continued enhancement of the properties.
This transaction underscores Marathon’s continued focus on commercial real estate investments in the senior housing sector, a market segment characterized by growing demand and limited supply. The refinancing provides Lone Star with the flexibility to maintain and enhance the portfolio while optimizing its financial structure.
Overview of the Portfolio
The Portfolio comprises eleven purpose-built senior housing communities with a combined total of 1,564 units. The majority of the properties—ten of eleven—are located in primary markets across Florida, a region known for its strong demographic tailwinds and growing senior population. The remaining property is located in the Dallas-Fort Worth Metroplex, a market with a robust demand for senior housing driven by population growth and economic stability.
Since acquiring the properties in 2021, Lone Star has made strategic capital investments to improve the overall quality, functionality, and appeal of the communities. These enhancements have included renovations, operational upgrades, and amenities improvements designed to attract and retain residents. The portfolio continues to operate under the experienced management of Discovery Senior Living, which oversees more than 46,000 senior housing units across the United States.
Strategic Capital Investments by Lone Star
Lone Star has focused on both short-term and long-term capital improvements across the portfolio. These investments are aimed at maintaining competitive positioning within each market while also increasing the overall value and operational efficiency of the properties. Renovations and upgrades have been carefully tailored to meet the evolving needs of senior residents, including enhancements to living spaces, common areas, and community amenities.
By investing in these strategic upgrades, Lone Star is not only enhancing the resident experience but also improving operational efficiency and long-term asset performance. These investments support the broader objective of creating high-quality senior housing that addresses the growing demand in primary markets while generating sustainable returns for investors.
Marathon’s Role in the Transaction
Marathon’s Commercial Real Estate team, led by Partner Joseph Griffin, played a critical role in originating the $235 million loan. The team worked closely with Lone Star to structure a financing solution that supports the refinancing objectives while maintaining flexibility for future operational and capital needs.
Joseph Griffin, Partner and Head of Commercial Real Estate at Marathon, emphasized the firm’s confidence in the senior housing sector. He stated, “Marathon continues to expand its presence within the senior housing sector, given the compelling underlying fundamentals of the asset class, driven by rapidly growing demand versus the limited supply of stock. Our partnership with Lone Star reflects our confidence that the assets and markets are well-positioned to capitalize on the favorable demographic tailwinds within senior housing.”
The transaction highlights Marathon’s ability to partner with experienced sponsors in sectors supported by long-term structural demand. The firm continues to prioritize disciplined underwriting and strategic investment selection across its commercial real estate platform.
CBRE Advisory and Transaction Support
CBRE’s National Senior Housing team served as the advisor for the transaction, providing critical guidance and support to ensure the successful execution of the refinancing. The CBRE team, including Vice Chairman Aron Will, Senior Vice President Matthew Kuronen, and Vice President Michael Cregan, arranged the financing and helped structure the loan to align with both Lone Star’s strategic goals and the operational needs of the portfolio.
CBRE’s involvement underscores the importance of collaboration between experienced operators, lenders, and advisors in executing complex commercial real estate transactions. The firm’s expertise in senior housing financing contributed significantly to the smooth and timely completion of the loan.
Market Fundamentals Driving Senior Housing
The senior housing sector continues to experience strong growth due to demographic trends and limited supply. With an aging population and increasing life expectancy, the demand for high-quality senior living options is rising across the United States. These market fundamentals provide a strong backdrop for investments in senior housing, particularly in primary markets such as Florida and Dallas-Fort Worth.
Marathon and Lone Star’s joint strategy leverages these trends by focusing on assets that benefit from both favorable demographics and operational expertise. By investing in well-located communities and supporting them with experienced management and targeted capital improvements, the partnership aims to deliver strong performance and long-term value creation.
Statements from Marathon Leadership
Bruce Richards, Chairman and CEO of Marathon, shared his perspective on the transaction, highlighting the strength of the firm’s commercial real estate platform. He stated, “This transaction highlights the strength and consistency of Marathon’s commercial real estate platform. We remain focused on disciplined underwriting and partnering with experienced sponsors in sectors supported by long-term structural demand.”
Richards’ remarks reflect Marathon’s commitment to strategic investment, risk management, and long-term value creation within the senior housing sector. The refinancing demonstrates the firm’s capability to execute large-scale transactions while supporting sponsors in achieving operational and financial objectives.
Perspective from Lone Star
Jerome Foulon, Global Head of Commercial Real Estate at Lone Star, also commented on the refinancing. He noted, “We were pleased to partner with Marathon and CBRE on the successful refinancing of this senior housing portfolio. Lone Star believes these assets will continue to benefit from capital investments, strong management, and overall growing market demographics.”
Foulon’s statement emphasizes Lone Star’s confidence in the portfolio’s future performance and the benefits of continued investment and operational enhancements. The refinancing provides the company with the flexibility to execute its strategic vision and strengthen the portfolio’s long-term position in the senior housing market.
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