Office Properties Income Trust (OPI) announced it has entered into an exchange agreement with certain noteholders to refinance up to $340 million of its outstanding 4.50% senior unsecured notes due 2025. This private exchange is expected to close before year-end 2024, aiming to address significant near-term debt maturities.
Under the terms, noteholders will exchange their 2025 notes for approximately $445 million of new 3.25% senior secured notes due 2027, cash for accrued interest, and approximately 11.5 million shares of OPI common stock. The common shares represent 19.9% of OPI’s issued and outstanding common shares as of the agreement date, with OPI also paying $25 million in premiums to certain noteholders.
The new 2027 notes will be secured by first-priority liens on 35 properties with a Gross Book Value of approximately $1.3 billion and second-priority liens on 19 additional properties that secure OPI’s $610 million of senior secured notes due 2029. OPI intends to repurchase or redeem the remaining $113.6 million of outstanding 2025 notes with cash upon the consummation of this exchange.
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