Diversified Healthcare Trust announced on March 31, 2025, the closing of a $140 million mortgage financing. This loan is secured by 14 senior living communities, comprising 1,375 units, managed by Five Star Senior Living.
The non-recourse, three-year loan features a variable interest rate based on SOFR plus a margin of 2.50% per annum, with 24 months of interest-only payments. DHC also purchased a one-year interest rate cap with a SOFR strike rate of 4.50% in connection with this financing.
The proceeds from this loan are intended to redeem a portion of DHC's outstanding 9.750% senior notes due in 2025. The financing reflects a loan-to-value ratio of approximately 62% and an implied capitalization rate of 7.0% based on the appraised value of $163,500 per unit for the collateral communities. DHC expects to close an additional $200 million in secured financings within the next 45 days.
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