Diversified Healthcare Trust announced on April 27, 2025, the closing of a $109 million 10-year fixed-rate mortgage financing through Freddie Mac. This loan is secured by seven senior living communities, totaling 1,184 units, managed by Five Star Senior Living.
The loan carries a fixed interest rate of 6.22%, with interest-only payments for the first five years, and matures on May 1, 2035. The proceeds from this financing are designated to redeem a portion of DHC's outstanding 9.750% senior notes due in 2025.
The appraised value of the seven collateral communities is $236 million, reflecting an implied cap rate of 7.3% or approximately $199,000 per unit. The loan-to-value ratio for this financing is approximately 47%. DHC anticipates closing an additional $94 million in secured financings by the end of May 2025, which, combined with current proceeds and cash, will provide ample liquidity to redeem the 2025 senior notes.
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