Diversified Healthcare Trust closed a nine-figure Freddie Mac financing secured by seven seniors housing communities in five states. Totaling 1,184 units, the assets are managed by Five Star Senior Living, the operating division of AlerisLife Inc.
The $109 million loan comes with a 10-year term and a 6.22% fixed interest rate, with interest only payable during the first five years. It matures on May 1, 2035, and DHC intends to use the loan proceeds to redeem a portion of its outstanding 9.75% senior notes due in 2025. Based on the 2024 NOI for the seven collateral communities, the appraised value of $236 million reflects an implied cap rate of 7.3%, or approximately $199,000 per unit, making the loan-to-value ratio on the financing approximately 47%.
As previously disclosed, DHC has two additional executed term sheets with different lenders for total loan proceeds of approximately $94 million. Those loans are expected to close by the end of May 2025. Those proceeds, in combination with the $109 million of Freddie Mac loan proceeds and cash on hand, provide liquidity to redeem the senior notes due in 2025.
