WASHINGTON, DC – December 7, 2010 – (RealEstateRama) — The U.S. Department of Housing and Urban Development (HUD) today announced a commitment to insure a mortgage loan to the Effingham County Hospital Authority in Springfield, Georgia. The $31 million loan is made possible through the Federal Housing Administration’s (FHA) Section 242 Hospital Mortgage Insurance Program.
The existing hospital facility has space limitations and infrastructure problems. Portions of the facility such as the emergency room, surgery suites, and imaging areas, are unable to accommodate today’s technology. The FHA-insured loan will be used to finance an addition to the facility that will include a new emergency room, inpatient and outpatient surgery areas, laboratory, and imaging departments. The project will also include renovation of existing space for a dedicated Alzheimer’s unit.
“FHA financing is helping to expand access to medical care in this part of Georgia,” said FHA Commissioner David Stevens. “By helping to make these projects possible, FHA also contributes to the financial well-being of communities by creating jobs to stimulate local economies.”
HUD estimates the Effingham County Hospital Authority construction project will support 342 full-time jobs and provide an estimated economic stimulus of more than $80.8 million to the community. Once completed, it is estimated the project will support 142 full-time jobs and provide an annual economic benefit of $22.7 million. 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.
By insuring the mortgage loan, FHA is enabling the hospital to obtain lower cost financing that will save an estimated $6.2 million in interest expense over the life of the loan. Since 1968, FHA has insured 394 mortgages to hospitals throughout the nation.
FHA’s Section 242 Mortgage Insurance Program for Hospitals provides HUD-insured mortgages made by private lending institutions to finance construction or renovation of acute care hospitals including major equipment needed to operate the facility. Eligible applicants can be public, proprietary, or nonprofit hospitals certified by the responsible State agency.
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.