|HUD No. 11-022
February 28, 2011
HUD APPROVES $29 MILLION REFINANCING FOR RIVERSIDE HOSPITAL
Parkview Community Hospital Medial Center to restructure debt and upgrade medical equipment
WASHINGTON - The U.S. Department of Housing and Urban Development (HUD) today announced a commitment to insure a mortgage loan to Parkview Community Hospital Medical Center in Riverside, California. The $29 million loan is made possible through the Section 223(f) component of the Federal Housing Administration's (FHA) Section 242 Hospital Mortgage Insurance Program.
Parkview is the first hospital to refinance debt through Section 223(f). The program provides for refinancing of a hospital's debts without conditioning such refinancing on new construction or renovation.
"This refinance program is designed to help hospitals struggling with high interest rates and limited credit options," said FHA Commissioner David Stevens. "The savings provided through FHA refinancing will help hospitals like Parkview hold down the cost of healthcare and better serve the community."
Parkview is a 193-bed acute care hospital that has served the Riverside area for more than 50 years. It is currently paying 20 percent interest on its existing debt. The new FHA-insured mortgage will have an interest rate of approximately 7 percent, saving the hospital almost $3 million per year. In addition, the new mortgage will provide the hospital with funds to purchase $1.8 million in medical equipment to upgrade the facility's Neonatal Intensive Care Unit.
HUD estimates Parkview Community Hospital Medical Center generates more than $300 million in annual economic activity and supports a total of 2,223 jobs in the community. More than 600 workers are employed by the hospital. HUD's estimates are based on results from an economic model used by public and private institutions to examine a variety of economic development issues.
Since 1968, FHA has insured 395 mortgage loans totaling $17 billion to hospitals in 43 states and Puerto Rico. The Section 242 program serves the full spectrum of acute care hospitals, including small rural hospitals, inner-city hospitals, and large academic medical centers.
HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes: utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination; and transform the way HUD does business. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov.