Diversified Healthcare Trust Closes $94.3 Million of Mortgage Financings Secured by Six SHOP Communities

Published: 2025-06-02 09:36:00 ET DHC

Published on 06/02/2025 at 09:36

Diversified Healthcare Trust (DHC) announced that it has closed two fixed rate mortgage financings totaling $94.3 million, secured by six senior housing communities managed by Five Star Senior Living, the operating division of AlerisLife Inc. The financings consist of a $64.0 million five-year mortgage loan and a $30.3 million ten-year Fannie Mae mortgage loan. Proceeds from these loans, together with cash on hand, will be used to repay the remaining $100.0 million of DHC?s 9.75% senior notes due June 2025. The $64.0 million loan bears a fixed interest rate of 6.57% and is secured by four communities consisting of 1,079 units with an appraised value per unit of approximately $171,000.

The Fannie Mae loan bears a fixed interest rate of 6.36%, is interest only for the first three years, and is secured by two communities consisting of 465 units with an appraised value of approximately $142,000 per unit. Based on the 2024 NOI of the six collateral communities, the appraised value reflects an implied cap rate of 5.8%, or approximately $162,000 per unit. Since March 2025, DHC has closed on an aggregate of $343.0 million of mortgage financings secured by 27 SHOP communities.

On a combined basis, these financings reflect an average per unit valuation of approximately $174,000 and a weighted average interest rate of 6.55%.